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Minnesota has enacted a new law that will affect many employers over the next few years, and we want to make sure you hear about it from us first—with clarity and options.
What’s Changing
The Minnesota Secure Choice Retirement Program requires most employers with five or more employees who do not currently offer a qualified retirement plan to provide access to a state-run retirement program. This is being phased in based on employer size, starting in 2026.
Under Secure Choice:
- Employees are automatically enrolled in a state-administered IRA
- Contributions come only from the employee (employers cannot contribute)
- Employers are required to facilitate payroll deductions
- The program is designed as a baseline solution, not a comprehensive benefits strategy
Important Considerations Before Defaulting to the State Plan
While Secure Choice may meet minimum compliance requirements, it comes with several limitations that employers should carefully consider:
- No employer contributions allowed
- This removes one of the most powerful tools employers have for attracting, retaining, and rewarding employees.
- Lower contribution limits
- IRA limits are significantly lower than 401(k) or other employer-sponsored plans, restricting how much employees—especially owners and key staff—can save.
- Limited plan design and control
- Contribution structure, investment menu, and features are dictated by the state, not tailored to your workforce.
- Minimal differentiation as a benefit
- Because Secure Choice is mandatory and standardized, it does little to set your company apart in a competitive labor market.
- Still an administrative responsibility
- Payroll coordination, employee communication, and compliance oversight still fall on the employer.
For many businesses, Secure Choice is a compliance tool, not a strategic benefit.
Better Options Exist—and That’s Where We Come In
The good news is that Secure Choice is not your only option.
Many employers choose to proactively implement an alternative retirement plan, such as:
- A streamlined 401(k) or Pooled Employer Plan (PEP)
- SIMPLE or SEP IRAs, depending on business structure
- Custom designs that allow employer contributions, higher savings limits, and greater flexibility
These solutions can:
- Fully exempt you from the state mandate
- Provide greater control and predictability
- Enhance your total rewards strategy
- Better serve owners, executives, and employees alike
How We Can Help
Our role is to help you:
- Understand how the Secure Choice law applies to your business
- Evaluate whether the state plan truly fits your goals
- Compare compliant alternatives side by side
- Implement a solution that aligns with your workforce, budget, and long-term objectives
There is no one-size-fits-all answer—but there is a right answer for your organization.
If you’d like to discuss how this law impacts you and what options make the most sense, we’re here to help.
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