--- title: MN Retirement Mandate — Is Secure Choice Really Your Best Option? description: Minnesota employers with 5+ employees must enroll in Secure Choice or offer a plan. See how a 401(k) compares, including up to $191,500 in tax credits. image: https://blog.proresourceshr.com/hubfs/AI-Generated%20Media/Images/Modern%20Office%20Workspace%20With%20Financial%20Planning%20Documents.png --- [Skip to content](https://blog.proresourceshr.com/minnesotas-retirement-mandate-is-here.-is-secure-choice-really-your-best-option#primary) [![PRO Resources](https://blog.proresourceshr.com/hubfs/raw_assets/public/Proresourceshr_2024/images/Pro-Resources-logo.svg "PRO Resources")](https://www.proresourceshr.com/) - [Services](https://www.proresourceshr.com/services/) - [Employee Administration](https://www.proresourceshr.com/services/employee-administration/) - [Payroll Administration](https://www.proresourceshr.com/services/payroll-outsourcing/) - [Benefits Administration](https://www.proresourceshr.com/services/benefits-administration/) - [Workers’ Compensation](https://www.proresourceshr.com/services/workers-compensation/) - [Wellness Programs](https://www.proresourceshr.com/services/wellness-programs/) - [Working With PRO](https://www.proresourceshr.com/working-with-pro/) - [Why PRO](https://www.proresourceshr.com/working-with-pro/why-pro/) - [Pricing](https://www.proresourceshr.com/working-with-pro/pricing/) - [Technology](https://www.proresourceshr.com/working-with-pro/technology/) - [Compare Us](https://www.proresourceshr.com/working-with-pro/compare-us/) - [FAQ](https://www.proresourceshr.com/working-with-pro/faq/) - [About](https://www.proresourceshr.com/about-us/) - [Our Team](https://www.proresourceshr.com/about-us/our-team/) - [Our Locations](https://www.proresourceshr.com/about-us/our-locations/) - [Network With Us](https://www.proresourceshr.com/about-us/partners/) - [Careers](https://www.proresourceshr.com/careers/) - [Industry Expertise](https://www.proresourceshr.com/industry-expertise/) - Resources - [Technology Resources](https://www.proresourceshr.com/resources/techresources) - [Blog](https://blog.proresourceshr.com) - [Case Studies](https://www.proresourceshr.com/resources/case-studies/) - [Guides](https://www.proresourceshr.com/resources/guides/) - [Ultimate Guide to PEOs](https://info.proresourceshr.com/ultimate-guide-to-peos) - [Videos](https://www.proresourceshr.com/resources/videos) - [Webinars](https://www.proresourceshr.com/resources/events/) - [ROI Calculator](https://www.proresourceshr.com/resources/savings-calculator) [Login](https://prohr.prosoftware.com/login.html) [Contact](https://www.proresourceshr.com/contact) Mobile Menu Toggle - [Services](https://www.proresourceshr.com/services/) - [Employee Administration](https://www.proresourceshr.com/services/employee-administration/) - [Payroll Administration](https://www.proresourceshr.com/services/payroll-outsourcing/) - [Benefits Administration](https://www.proresourceshr.com/services/benefits-administration/) - [Workers’ Compensation](https://www.proresourceshr.com/services/workers-compensation/) - [Wellness Programs](https://www.proresourceshr.com/services/wellness-programs/) - [Working With PRO](https://www.proresourceshr.com/working-with-pro/) - [Why PRO](https://www.proresourceshr.com/working-with-pro/why-pro/) - [Pricing](https://www.proresourceshr.com/working-with-pro/pricing/) - [Technology](https://www.proresourceshr.com/working-with-pro/technology/) - [Compare Us](https://www.proresourceshr.com/working-with-pro/compare-us/) - [FAQ](https://www.proresourceshr.com/working-with-pro/faq/) - [About](https://www.proresourceshr.com/about-us/) - [Our Team](https://www.proresourceshr.com/about-us/our-team/) - [Our Locations](https://www.proresourceshr.com/about-us/our-locations/) - [Network With Us](https://www.proresourceshr.com/about-us/partners/) - [Careers](https://www.proresourceshr.com/careers/) - [Industry Expertise](https://www.proresourceshr.com/industry-expertise/) - Resources - [Technology Resources](https://www.proresourceshr.com/resources/techresources) - [Blog](https://blog.proresourceshr.com) - [Case Studies](https://www.proresourceshr.com/resources/case-studies/) - [Guides](https://www.proresourceshr.com/resources/guides/) - [Ultimate Guide to PEOs](https://info.proresourceshr.com/ultimate-guide-to-peos) - [Videos](https://www.proresourceshr.com/resources/videos) - [Webinars](https://www.proresourceshr.com/resources/events/) - [ROI Calculator](https://www.proresourceshr.com/resources/savings-calculator) [Login](https://www.proresourceshr.com/login) [Contact](https://www.proresourceshr.com/contact) ![](https://blog.proresourceshr.com/hs-fs/hubfs/AI-Generated%20Media/Images/Modern%20Office%20Workspace%20With%20Financial%20Planning%20Documents.png?width=1200&height=630&name=Modern%20Office%20Workspace%20With%20Financial%20Planning%20Documents.png) # MN Retirement Mandate — Is Secure Choice Really Your Best Option? 5 min. read | October 22, 2026 If you run a Minnesota business and don't offer a retirement plan, the clock is already running. Minnesota Secure Choice, the state's new auto-IRA program, applies to any private-sector employer that has done business in Minnesota for at least 12 months and has five or more covered employees receiving Minnesota taxable wages. Covered employers must either enroll their workers in the state's payroll-deduction IRA program or certify an exemption if they already sponsor a qualifying plan. Many business owners assume the state program is the simple, default choice. It does satisfy the law. But for many employers, a 401(k) costs about the same or less once you count federal tax credits, and it gives you and your team a lot more. ## Know your deadline Registration is phased in by company size. The first deadline, June 30, 2026, for employers with 100 or more employees, has already passed. These deadlines are still ahead: - **50–99 employees:** December 31, 2026 - **25–49 employees:** June 30, 2027 - **10–24 employees:** December 31, 2027 - **5–9 employees:** June 30, 2028 Missing your window has a cost. Noncompliant employers face graduated fines of up to $500 per employee after an initial warning period. If you have 50–99 employees, you have about ten weeks left. That is enough time to set up a 401(k), but not enough to put off the decision. ## What Secure Choice looks like for employers Secure Choice is built to be a basic savings option. Employees are automatically enrolled at a 5% contribution rate unless they opt out. The program is funded only through employee payroll deductions, and employer contributions are not permitted. That means you can't offer a match to recruit or keep good people, and you get no employer deduction or federal tax credit. The state handles the IRA accounts and investments. Your business still has ongoing work to do, though. Employers must remit payroll contributions for active employees every pay period, update contribution rates when employees make changes, and keep the employee list current. That work comes back every pay cycle, and it lands on your payroll team. Employees can also save less. For 2026, the IRA contribution cap is $7,500 for workers under 50. A 401(k) allows $24,500. ## The 401(k) alternative through ## PRO Resources A 401(k) through Pro Resources meets the same mandate , with far more flexibility for you and your employees: | | Secure Choice | 401(k) with Pro Resources | | --- | --- | --- | | Employee contribution cap (2026, under 50) | $7,500 | $24,500 | | Employer contributions | Not permitted | Optional and tax-deductible | | Default auto-enrollment rate | 5% | 3% | | Investment options | Limited state menu | No-load funds from Vanguard, Fidelity, Dimensional, American Funds, MFS and John Hancock | | Administration | Employer remits and maintains records | Enrollment, compliance, testing and filings handled for you | The pricing is simple. Plan setup costs $0. The company admin fee is $350 per year, and participant fees largely offset it. There is also a $39 per-participant annual admin fee and an asset-based fee that starts at 0.75% and drops to 0.15% as your plan grows. ## The part most employers miss: ## federal tax credits A new 401(k) plan can qualify for three SECURE 2.0 tax credits. Secure Choice qualifies for none of them. **1. Plan startup credit.** In the year the plan starts and the two years after, you can claim the greater of $500 or $250 per eligible non-highly compensated employee, up to $5,000 per year. A company with 20 or more eligible NHCEs could receive $5,000 a year for three years. **2. Auto-enrollment credit.** Plans that include automatic enrollment earn an extra $500 per year for three years. **3. Employer contribution credit.** This is the largest of the three. Employers with 100 or fewer employees can claim up to $1,000 per employee earning $100,000 or less in FICA wages (adjusted for inflation), limited to what you actually contribute. The credit is 100% in the first two years, then 75%, 50% and 25%. For employers with 51–100 employees, the credit shrinks by 2% for each employee over 50. Here's how that works for a 50-employee company that contributes $1,000 per employee: | Year | Contribution credit | | --- | --- | | Year of adoption | $50,000 | | Year 2 | $50,000 | | Year 3 | $37,500 | | Year 4 | $25,000 | | Year 5 | $12,500 | | **Total** | **$175,000** | Add $15,000 in startup credits and $1,500 in auto-enrollment credits, and the total reaches **$191,500 over five years**. A 75-employee company with the same contribution would see about $131,250 from the contribution credit alone, after the phaseout. Your actual credit depends on your headcount, wages and contributions. Talk with your tax advisor about your situation. ## The bottom line Secure Choice meets the requirement. A 401(k) meets the requirement and also helps you recruit, cuts your tax bill, and lets your employees save more than three times as much each year. With a $0 setup cost and federal credits that can cover much of the cost in the early years, the 401(k) is often the stronger business decision. **Let's find the right fit for your business.** [Contact us.](https://www.proresourceshr.com/contact) *This article is for informational purposes only and is not tax, legal or investment advice. Consult a qualified tax or financial advisor about your situation.* Share: - - - - [MN Retirement Mandate — Is Secure Choice Really Your Best Option?](https://blog.proresourceshr.com/minnesotas-retirement-mandate-is-here.-is-secure-choice-really-your-best-option) [HR Administration: In-House or Outsourced?](https://blog.proresourceshr.com/hr-administration-in-house-or-outsourced) [Why Payroll and Benefits Take SMBs So Much Time](https://blog.proresourceshr.com/why-payroll-and-benefits-take-smbs-so-much-time-clone) [Is Workers' Comp Draining Your Budget? 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