The California 401(k) Plan Launches First Ever 401(k) Multi-employer Plan Alternative To Replace CalSavers
The California 401(k) Plan today launched a new private marketplace multi-employer pooled plan (PEP). The California 401(k) Plan is based on the idea that people want more money in their retirement accounts over time than the state plan limits and plan default fund offer.
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Employers who prefer to band together to achieve economies of scale envisioned by the SECURE ACT, and better investments now get to skip past CalSavers and the EDD, the Franchise Tax Board for a retirement and now instead have A Better 401(k) Plan™
- Allows Higher Contributions
- Grants Control of Plan Design to Employer
- Includes Larger Federal Incentives for Employers
- Delivers CFP-level Advisor Referral for Any Company
“It’s a complete solution, instead of the expensive half measure of a state plan so that employers can opt out of CalSavers like many of their employees do,” said a spokesperson for The 401(k) Plan Company.
Why can’t highly compensated employees participate in CalSavers? CPAs should expect headaches with the state plan auto enrolling highly comp’d employees and owners.
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In The California 401(k) Plan, the employer controls age, term of service and entry requirements, and exempt themselves from work associated with the state plan and enabling Roth Money Type for highly compensated and owners. The California 401(k) Plan also allows participants to select from a set of investments more appropriate to a retirement investor than the limited CalSavers options. Employers importantly will gain the ability to set aside or exclude high-turnover seasonal employees who don’t use gig work for retirement savings.
This is the first ever 401(k) PEP under the SECURE ACT, it is different from a state sponsored plan because it offers the best interest standard of care as a baseline. The California 401(k) Plan also helpfully allows the employer freedom from administration and embraces human-friendly A.I. Technology for the first ever end-to-end logic in retirement plan design and implementation decision-making in under one minute.
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