The California 401(k) Plan launches new multi-employer pooled plan

California 401(k) Plan

The California 401(k) Plan™ Outperforms State Plan on Each Key Factor:

– Higher returning default investment

– Solves Problem of $125K+ Wage-earners that CalSavers Leaves Out

– Best Interest Standard of Care

The California 401(k) Plan™ today launched a new private marketplace multi-employer pooled plan (PEP).  The California 401(k) Plan™ is based on the idea that people want more money in their retirement accounts over time than the state plan limits and plan default fund offer.

Simpler for Employers:

Instant Merger for Existing Plans Ready to be Forever Done with Audits and 5500s
Free first month for new plans requesting consultative comparisons

Employers who prefer to band together to achieve economies of scale envisioned by the SECURE ACT, and better investments now get to skip past CalSavers and the EDD, the Franchise Tax Board for a retirement and now instead have A Better 401(k) Plan™

  • Allows Higher Contributions
  • Grants Control of Plan Design to Employer
  • Includes Larger Federal Incentives for Employers
  • Delivers CFP-level Advisor Referral for Any Company

“It’s a complete solution, instead of the expensive half measure of a state plan so that employers can opt out of CalSavers like many of their employees do,” said a spokesperson for The 401(k) Plan Company.

Why can’t highly compensated employees participate in CalSavers?   CPAs should expect headaches with the state plan auto enrolling highly comp’d employees and owners.

In The California 401(k) Plan™, the employer controls age, term of service and entry requirements, and exempt themselves from work associated with the state plan and enabling Roth Money Type for highly compensated and owners. The California 401(k) Plan™ also allows participants to select from a set of investments more appropriate to a retirement investor than the limited CalSavers options.   Employers importantly will gain the ability to set aside or exclude high-turnover seasonal employees who don’t use gig work for retirement savings.

This is the first ever 401(k) PEP under the SECURE ACT, it is different from a state sponsored plan because it offers the best interest standard of care as a baseline.   The California 401(k) Plan™ also helpfully allows the employer freedom from administration and embraces human-friendly A.I. Technology for the first ever end-to-end logic in retirement plan design and implementation decision-making in under one minute.

By comparison, the state plan inexplicably actively spends money fighting to exempt itself from serving the best interest of either the employer or employee.

“Participants have chosen,” a spokesperson continued, “The opt out rate by employees from CalSavers is about three times what it is for a 401(k).”   People are actively declining the state alternative which disallows employers to contribute, uses a short-term instrument for a long term objective, and shortchanges investors on contribution limits.

Looking for a fresh start?

You aren’t alone, and we have helped many employers like you.  A federal tax credit is now available as well to help you improve on the state plan.

In California, when the state misguidedly applied AB-5 for gig workers and drivers, two months ago finally resolved after it took the electorate a year and vote to undo.  Once again, the private marketplace has delivered the correct solution for retirement with The California 401(k) Plan™.   Employers should expect more of the same from the state.   By comparison The California 401(k) Plan™ is shouldered entirely by a professional who act as fiduciaries and commit to the best interest standard of care for employers and employees.

The California 401(k) Plan™ comes in two separate options –

A solution for employers with 5-100 employees who wish to gain critical size and scale.   

Enterprise for 100+ employers who no longer want to deal with employer admin requirements and get welcome relief on audit, 5500, notice filings, through A Better 401(k) Plan™.

  • Price options: Can be employer tax credit offset or employee finance-all.

The California 401(k) Plan™ offers higher contribution limits, a stable value fund that outperforms, Roth eligibility regardless of wage level, which is a federal limit the state of California either failed to consider or purposely ran right over when auto enrolling highly compensated employees into a Roth. Ultimately the IRS will start educating employers and employees on whether a Roth IRA is available to married filing jointly couples who earn more than $200,000.    This is actually only allowable in a 401(k) plan, not an IRA like CalSavers. For this reason employers who want their employees to have more money in their retirement accounts will elect The California 401(k) Plan™

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