Last Updated: April 12, 2024

The Centennial State is carving paths to retirement freedom in the Rockies.

Approximately one million Colorado employees do not have access to a retirement savings plan through their employer, making it difficult to build a nest egg for their golden years. However, the state of Colorado has stepped up to meet this challenge with a solution of its own: the Colorado SecureSavings program.

In this article, we’ll answer some questions you may have about the Colorado SecureSavings program and explain how it affects Colorado businesses.

How Does Colorado SecureSavings Work?

Colorado SecureSavings is a government-sponsored savings program created to help employees working in Colorado build savings for retirement. Colorado business owners who meet certain criteria are required by law to offer a qualified, employer-sponsored retirement plan or enroll their employees in the program.

Colorado employees can make contributions to the program through automatic deductions from their paycheck into a Roth individual savings account (Roth IRA) unless they choose to opt out. The money in the account grows tax-free, and employees won't have to pay income tax on any money they withdraw from their account during retirement.

Colorado SecureSavings is overseen by the Colorado Department of Treasury and administered by private-sector partners. The program launched in January 2023.

Which Businesses Are Affected?

According to the Colorado SecureSavings website, employers who meet the following criteria are required to register for the program or certify an exemption:

• Has at least five employees
• Has been in business for more than two years
• Does not already offer a qualified retirement program

Registration Deadline

Program deadlines for businesses are based on company size, and they have all passed. The breakdown is as follows:

• Employers with 50 or more employees | March 15, 2023 (deadline passed)
• Employers with 15 to 49 employees | May 15, 2023 (deadline passed)
• Employers with 5 to 14 employees | June 30, 2023 (deadline passed)

Eligible employers will be notified when it's time to register or certify their exemption.

Penalties

Eligible employers must offer a plan or may face a fine of up to $100 per eligible employee per year (up to a max of $5,000 annually).

Who Is Eligible to Save With the Colorado SecureSavings Program?

Any individual who is 18 years or older and has earned taxable wages with their Colorado employer for at least 180 days is eligible to participate in Colorado SecureSavings.

The program is voluntary for employees, and they can change their contribution amount or opt-out at any time.

Conclusion

The Colorado SecureSavings program represents a notable development in retirement planning for Colorado workers. Automatic enrollment and contributions made directly through payroll deductions simplify the process of setting aside funds for retirement.

The program requires businesses that have been active for more than two years and have five or more employees to either offer a plan or certify an exemption, so it’s important for Colorado employers to familiarize themselves with the program details and requirements.

Looking for information on the requirements for other states? Check out our resource page here.