Colorado Secure Savings Program

The Colorado Secure Savings Program is a state-facilitated retirement savings program for private-sector employees in Colorado. It is a Roth Individual Retirement Account (IRA) that employees can contribute to directly from their paychecks. The program is voluntary for employees, but they are automatically enrolled unless they opt-out.

The Colorado Secure Savings Program was created to address the fact that many private-sector employees in Colorado do not have access to a retirement savings plan at work.

According to the Colorado SecureSavings Board, more than 40% of Colorado’s private-sector workforce does not have access to a retirement savings plan at work. This means that nearly 940,000 workers in Colorado have no way to save for retirement through their employer.

The Colorado Secure Savings Program is designed to be easy and convenient for employers and employees. Employers are required to participate in the program if they have five or more employees in Colorado and do not already offer a qualified retirement plan. Employers can set up the program in just a few steps and there is no cost to employers to participate.

Employees can choose to contribute any amount of money to their Colorado Secure Savings account, up to the annual IRA contribution limit. Employees can also change their contribution amount at any time. Employees have access to online tools and real people trained to answer their questions about the program.

The Colorado Secure Savings Program is a great way for private-sector employees in Colorado to save for retirement. It is easy, convenient, and portable. Employees can continue contributing to their Colorado Secure Savings account even if they change jobs.

Colorado Secure Savings Program 2023

The Colorado SecureSavings Program, also referred to as Colorado SecureSavings, was established by the Colorado SecureSavings Board within the Office of the State Treasurer. It was created in response to a significant portion of the state’s private-sector workforce — about 40% or nearly 940,000 workers — lacking access to retirement savings plans at their places of employment.

How Does the Colorado Secure Savings Program Work?

The Colorado Secure Savings Program works as a state-facilitated retirement savings plan for employees who do not have access to an employer-sponsored retirement plan. Here’s a brief overview of how it functions:

1. Mandatory Employer Participation: Employers that have been in business for at least two years and have five or more employees must facilitate the program if they do not offer a retirement plan.
2. Automatic Employee Enrollment: Employees who meet the eligibility criteria (18 years or older, employed for at least 180 days by a Colorado employer, and earning taxable wages in Colorado) are automatically enrolled in the program.
3. Contributions: Employees contribute to their retirement savings through automatic payroll deductions, which go into a Roth Individual Retirement Account (IRA).
4. Fees: Employees pay an annual asset-based fee of about 0.32%, and an annual account fee of $22, charged quarterly.
5. Opt-out Option: Employees are enrolled automatically but have the option to opt out of the program if they choose not to participate.
6. Portability: The retirement savings account is portable, meaning it stays with the employees if they change jobs within the state.
7. Employer Restrictions: Employers are not allowed to contribute to or match the contributions made to the SecureSavings accounts by their employees.
8. Compliance Deadlines: Employers had specific deadlines by which they were required to facilitate the program, depending on the size of their workforce.

This program is designed to ensure that more workers in Colorado have an easy and accessible way to save for retirement, particularly those who work for smaller businesses that may not offer retirement savings plans.

Benefits of the Colorado Secure Savings Program:

• Easy to set up and manage: Employers can set up the program in just a few steps and there is no cost to employers to participate. Employees can easily manage their account online.
• Portable: Employees can continue contributing to their Colorado Secure Savings account even if they change jobs.
• Affordable: Employees can choose to contribute any amount of money to their account, up to the annual IRA contribution limit.
• Investment options: The Colorado Secure Savings Program offers a variety of investment options to meet the needs of different employees.
• Financial education resources: Employees have access to online tools and real people trained to answer their questions about the program and retirement planning.

Who Is Eligible for the Colorado Secure Savings Program?

Employees are eligible for the Colorado Secure Savings Program if they meet the following criteria:

1. They are 18 years of age or older.
2. They have been employed by a Colorado employer for at least 180 days.
3. They earn taxable wages in Colorado.

Once these conditions are met, employees are automatically enrolled in the program but have the option to opt out if they choose​.

Who Is Ineligible for Colorado Secure Savings?

For the Colorado Secure Savings Program, individuals who would typically be considered ineligible are:

1. Employees who work for an employer that already offers a qualified retirement plan, such as a 401(k), 403(b), SEP-IRA, SIMPLE IRA, or a pension.
2. Workers who are under 18 years of age.
3. Employees who have not been employed by a Colorado employer for at least 180 days.
4. Individuals who do not earn taxable wages in Colorado.
5. Employees working for businesses that have been in operation for less than two years or have fewer than five employees, as these businesses are not mandated to facilitate the program under the current legislation​​​​.
6. Only workers with a verifiable Individual Tax Identification Number (ITIN) or Social Security Number (SSN) can participate in the program. If a worker’s information cannot be verified, the worker will not be enrolled, and an account will not be established for him or her.

It’s also worth noting that even if someone is automatically enrolled because they are eligible, they can opt out at any time if they decide not to participate in the program.

Mandatory Participation in Colorado Secure Savings Program

The program is mandatory for companies that have been in business for more than two years and have at least five employees. There are penalties for non-compliance, which can go up to $100 per eligible employee per year, with a maximum of $5,000 annually

Colorado Secure Savings Program FAQ

Suppose you are a private-sector employee in Colorado and you do not have access to a retirement savings plan at work. In that case, you should consider participating in the Colorado Secure Savings Program. It is a great way to start saving for retirement and secure your financial future.