This week’s state-run retirement plan series focuses on the Garden State of New Jersey. Past blog posts: Washington, California’s, Illinois, Massachusetts, and an overview of state-run retirement programs.
New Jersey’s Small Business Retirement Marketplace Act was modeled on Washington’s plan that we looked at last week. It originated as A 4275 with the intent to create the New Jersey Secure Choice Savings Program, but was vetoed by Governor Christie and replaced by Pamphlet Law 2015, Chapter 298, which he signed into law on Jan. 19, 2016.
Pamphlet Law 2015, Chapter 298 notes that, according to the AARP, 1.7 million private sector employees do not have an employee-provided retirement savings plan. The Small Business Retirement Marketplace will provide retirement savings options for active small businesses with 100 or fewer employees, provided that most of the employees reside in New Jersey. Small businesses may voluntarily participate in the program and their employees may also choose to participate.
A minimum of two types of plans must be offered by the private financial service firms participating in the Marketplace. These include a simple IRA plan where employees can contribute to individual employee accounts and a plan that provides for payroll deduction where employers do not contribute. In addition, the federally-operated myRA program will be available.
The Marketplace operates under the New Jersey State Treasurer’s office, and will be available to employees and employers through an online portal.
Photo Credit: Jersey City, New Jersey by Peter Miller