Are you ready for Retire Ready NJ?
Originally passed in 2019, on June 30, 2024, New Jersey launched Retire Ready New Jersey. Retire Ready NJ (hereinafter referred to as “the Program”) is a state-run retirement savings program for employees of private employers who do not offer a qualified retirement savings plan. All employers should be aware of the provisions of Retire Ready NJ and how the Program affects them.
Registration Requirements
The Program requires an employer who meets the following to register:
- The employer has more than 25 employees,
- The employer does not offer a qualified retirement savings plan, and
- The employer has been in business for at least 2 years
Once enrolled, an employer must begin automatic payroll deductions to be contributed to the Program unless an employee opts out. This will create compliance issues for employers both to ensure enrollment of new employees and to provide adequate documentation from any employee who wants to opt out of the Program.
Exempt Employers
Employers are exempt from registering for the Program if they offer a qualified retirement plan. Qualified retirement plans include Internal Revenue Code sections 401(a), 403(a), 403(b), 408(k), 408(p) or 457(b) plans. Basically, any qualifying retirement plans from a 401(k) to government deferred compensation plans will qualify. Consult your retirement plan advisor to determine if the retirement plan that your business offers is considered a qualified plan.
It should be noted that even if not required to enroll in the Program, all businesses must certify they are exempt from the Program on the “Retire Ready NJ” website.
Registration Deadlines
September 15, 2024 – for employers who have 40 or more employees
November 15, 2024 – for employers who have 25 – 39 employees
Non-Compliance
Penalties for failing to register vary depending upon how long an employer has been eligible to register for the Program. In the first calendar year after eligibility, an employer may receive a written warning. In the fifth year of eligibility, an employer could be subject to a $500 per employee fine for each employee not enrolled or who has not opted out of the Program.
For more information, please visit www.nj.gov/treasury/securechoiceprogram
