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Be prepared for state requirements and explore your options

Many states have already enacted state-facilitated retirement savings programs for private sector workers. The majority of these programs are mandatory, but employers in all program states retain the option of offering their own retirement plan.

Offering an employer-sponsored retirement plan has helpful benefits for both employers and employees. When deployed effectively, it can help your employees with their retirement readiness – and be a powerful recruiting and retention tool. Small businesses with under 100 employees starting a 401(k) now also have access to a significant tax credit through the SECURE Act.

Whether your business is starting its first retirement plan or looking to upgrade an existing retirement plan, HUB can help you take that big step forward. Contact us to review your options today.

401(K) VS State IRA

Differences Between 401(k) Plans and State-run Roth IRAs

401(k)

Roth IRA

Availability

  • Most employers can contribute
  • Employees can contribute
  • Only employees can contribute
  • Employer Advantages

  • Flexible plan design and vesting schedule
  • Tax deductible contributions
  • Possible tax credit for start-up costs
  • Enhanced contribution options for owners and highly compensated employees
  • Payroll integration
  • Attract and retain top talent
  • No year-end process
  • No cost to employer
  • No fiduciary liability
  • Employee Advantages

  • Higher contribution limits
  • Tax savings with pretax deductions from paycheck
  • Employer contributions
  • Easy, online setup
  • Distribution options such as loans and hardship
  • ERISA protection from creditors
  • No vesting schedule
  • Easy, online setup
  • Disadvantages

  • Annual notices, plan testing, and maintenance may be required
  • Cost to employer
  • No employer start-up cost tax credit
  • Lower contribution limits
  • Owners and highly compensated employees may not be able to contribute
  • Cost to employee
  • No ERISA protection from creditors
  • Differences Between 401(k) Plans and State-run Roth IRAs

    401(k)

    Roth IRA

    Availability

  • Most employers can contribute
  • Employees can contribute
  • Only employees can contribute
  • Employer Advantages

  • Flexible plan design and vesting schedule
  • Tax deductible contributions
  • Possible tax credit for start-up costs
  • Enhanced contribution options for owners and highly compensated employees
  • Payroll integration
  • Attract and retain top talent
  • No year-end process
  • No cost to employer
  • No fiduciary liability
  • Employee Advantages

  • Higher contribution limits
  • Tax savings with pretax deductions from paycheck
  • Employer contributions
  • Easy, online setup
  • Distribution options such as loans and hardship
  • ERISA protection from creditors
  • No vesting schedule
  • Easy, online setup
  • Disadvantages

  • Annual notices, plan testing, and maintenance may be required
  • Cost to employer
  • No employer start-up cost tax credit
  • Lower contribution limits
  • Owners and highly compensated employees may not be able to contribute
  • Cost to employee
  • No ERISA protection from creditors
  • Small Business

    HUB Retirement Select

    HUB Retirement Select is a fully bundled retirement plan that takes the guesswork out of plan administration and investment selection. Our service options accommodate for-profit and nonprofit companies of all sizes—from owner-only businesses to those with hundreds of employees.

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    ERISA 3(38) Investment Management

    When you choose HUB Retirement Select, you’ll have an ERISA 3(38) Investment Manager who provides the investment menu for your retirement plan – saving you time and informing you on the funds in your plan.

    Icon Check

    Intentional Plan Design

    We incorporate design features that recognize human behavioral weaknesses and work to counteract their impact. HUB Retirement Select’s default investment offering takes your employees’ evolving needs into consideration.

    Icon Check

    Fiduciary Risk Support

    Plan administration can be challenging to navigate without the appropriate resources. HUB Retirement Select offers access to the guidance you need at a price point appropriately scaled for your business.

    Icon Check

    Quarterly Resources

    You’ll receive a quarterly monitoring report that includes tools and analytics that make it easy to monitor and optimize your plan, and an economic update to help you understand the bigger picture.

    Differences Between 401(k) Plans and State-run Roth IRAs

    401(k)

    Roth IRA

    Availability

  • Most employers can contribute
  • Employees can contribute
  • Only employees can contribute
  • Employer Advantages

  • Flexible plan design and vesting schedule
  • Tax deductible contributions
  • Possible tax credit for start-up costs
  • Enhanced contribution options for owners and highly compensated employees
  • Payroll integration
  • Attract and retain top talent
  • No year-end process
  • No cost to employer
  • No fiduciary liability
  • Employee Advantages

  • Higher contribution limits
  • Tax savings with pretax deductions from paycheck
  • Employer contributions
  • Easy, online setup
  • Distribution options such as loans and hardship
  • ERISA protection from creditors
  • No vesting schedule
  • Easy, online setup
  • Disadvantages

  • Annual notices, plan testing, and maintenance may be required
  • Cost to employer
  • No employer start-up cost tax credit
  • Lower contribution limits
  • Owners and highly compensated employees may not be able to contribute
  • Cost to employee
  • No ERISA protection from creditors
  • Differences Between 401(k) Plans and State-run Roth IRAs

    401(k)

    Roth IRA

    Availability

  • Most employers can contribute
  • Employees can contribute
  • Only employees can contribute
  • Employer Advantages

  • Flexible plan design and vesting schedule
  • Tax deductible contributions
  • Possible tax credit for start-up costs
  • Enhanced contribution options for owners and highly compensated employees
  • Payroll integration
  • Attract and retain top talent
  • No year-end process
  • No cost to employer
  • No fiduciary liability
  • Employee Advantages

  • Higher contribution limits
  • Tax savings with pretax deductions from paycheck
  • Employer contributions
  • Easy, online setup
  • Distribution options such as loans and hardship
  • ERISA protection from creditors
  • No vesting schedule
  • Easy, online setup
  • Disadvantages

  • Annual notices, plan testing, and maintenance may be required
  • Cost to employer
  • No employer start-up cost tax credit
  • Lower contribution limits
  • Owners and highly compensated employees may not be able to contribute
  • Cost to employee
  • No ERISA protection from creditors
  • HUB Retirement Select

    HUB Retirement Select is a fully bundled retirement plan that takes the guesswork out of plan administration and investment selection. Our service options accommodate for-profit and nonprofit companies of all sizes—from owner-only businesses to those with hundreds of employees.

    Icon Check

    ERISA 3(38) Investment Management

    When you choose HUB Retirement Select, you’ll have an ERISA 3(38) Investment Manager who provides the investment menu for your retirement plan – saving you time and informing you on the funds in your plan.

    Icon Check

    Intentional Plan Design

    We incorporate design features that recognize human behavioral weaknesses and work to counteract their impact. HUB Retirement Select’s default investment offering takes your employees’ evolving needs into consideration.

    Icon Check

    Fiduciary Risk Support

    Plan administration can be challenging to navigate without the appropriate resources. HUB Retirement Select offers access to the guidance you need at a price point appropriately scaled for your business.

    Icon Check

    Quarterly Resources

    You’ll receive a quarterly monitoring report that includes tools and analytics that make it easy to monitor and optimize your plan, and an economic update to help you understand the bigger picture.

    Retirement Programs by State
    Many states looking to address the U.S. retirement savings gap have passed legislation mandating retirement benefits for private sector employees.
    Click on the name of your state below to see how state mandates can affect you and your business.
    Retirement Programs by State
    Many states looking to address the U.S. retirement savings gap have passed legislation mandating retirement benefits for private sector employees.
    Click on the name of your state below to see how state mandates can affect you and your business.

    Source: Georgetown University’s Center for Retirement Initiatives

    updated as of 1/14/22


    Source: Georgetown University’s Center for Retirement Initiatives

    updated as of 1/14/22