The State of Colorado has developed a brand-new retirement savings program called Colorado Secure Savings. Businesses can assist their employees in saving for retirement with Colorado Secure Savings by offering employees a no match Roth Individual Retirement Account (IRA) that is transferable even if the employee changes jobs or leaves the company. Employees in Colorado can easily save for the future with the help of this new initiative.

Summary of how the program works:

  • Employers incur no costs.
  • Easily integrates with your payroll procedure.
  • Contribution amounts that can be changed to suit employee needs.
  • If the employee switches employment, the money and account follow you because it is employee based not employer based.
  • It’s optional for employees; you can automatically stay enrolled or choose to disenroll and re-enroll later.

Here is what Employers need to know:

Colorado Secure Savings must be facilitated by all eligible Colorado businesses if they:

  • Have operated a business for at least two years.
  • Employ five or more people.
  • Do not currently provide any employees with a retirement savings plan (this is where Oxford can help; see below).

Do you offer a retirement program already?

For employers who don’t already provide their staff with a qualifying retirement savings plan, Colorado Secure Savings was developed. If you already provide one, you need to confirm your exemption after the program has officially begun.

Employers won’t be accountable for:

  • Creating the retirement savings accounts for your staff. The process is automatic.
  • Assisting employees in making investment decisions or responding to inquiries about Colorado Secure Savings and its investment options.
  • Managing adjustments to employee investment accounts. If enrolled, your employees are in charge of maintaining their account details and settings.

Here is what Employees need to know:

Program Eligibility:

You are qualified to open an account if

  • You are older than 18 years of age.
  • For at least 180 days, you have received taxable wages from a Colorado employer.

Choosing what to save:

You decide how much money to set aside. You will have the freedom to select the investment options and savings rate that feel the most comfortable to you. Need support? Call Oxford and we can help explain.

What to anticipate once you enroll:

After deducting taxes, 5% of your gross revenue from the facilitating employer will be sent into your account.  So, if that is too much or not enough you will need to connect with the program and choose the best numbers for you.  Again, call us if you have questions and we can give you a few questions to ask the program.

How much will this program cost me?

The annual asset-based fee at Colorado Secure Savings is roughly 0.32%. This implies that for every $100 in your account, you will pay about $0.32. Additionally, there is a $22 annual account fee (which is paid in quarterly installments of $5.50). The running costs imposed by the underlying investment funds in which the program’s portfolios are invested are also covered by these fees for program management.

So how does Oxford Financial Planners fit into this?

The first thing to note is this is a state program and not ran by Oxford or employers.  Employees self-manage this.

If you are an employer and would like to offer a different retirement plan with matching, please reach out and we can show you your options.  This is a great way to attract and retain good employees.

If you are an employee and you don’t understand the world of investing or Roth IRAs, please reach out for a phone call.  We can help clarify what is happening and point you in the right direction.

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Fiduciaries in Durango, Colorado.