Illinois launched the Secure Choice Savings Program in 2018 with phased implementation based on employer size. As of September 1, 2023, all employers with five or more employees that have been in business for two or more years are required to participate unless they have an employer-sponsored retirement plan in place. The chart below illustrates a brief summary of the program.
| Feature | State IRA Plan | Employer Sponsored 401k |
| Plan Type | Payroll Deduction Roth IRA | Pre-tax, Roth AND Employer Contributions |
| Contribution Limits | Limited to $7,000 (2024) | $23,000 (plus more if over age 50) |
| Compliance | Penalty of $250 per employee for the first calendar year or $500 per employee for each subsequent calendar year of noncompliance | Compliant with state program |
| Eligibility | 18 years old and employed, full-time or part-time, in the state of Illinois | Employer controls eligibility requirements |
| Plan Costs | $16.00 annually paid by the employee and 0.32-0.45% depending on investment choice | Dependent on type of plan design chosen. |
| Tax Deductible | NO | Employer contributions are tax deductible |
| Tax Credit Available | NO | Plan costs qualify for available tax credits |
| Default Contribution | 5% of annual pay unless employee opts out or elects lower amount | Employee choice |
| Auto Escalation Feature | Yes, annually up to 10% | NO |
| Minimum Employees to Participate | 5 | Any Number |
| Investments | 3 Funds + BlackRock Target Date Series | More than 25 funds in a variety of Morningstar categories |
