Nevada State Retirement Savings Program: What You Need to Know

In June of 2023, the Nevada Assembly passed SB305. While some specific details are still to be determined, we do know that the aim of this Senate Bill is to close the retirement plan gap in the private sector.

Watch the video below to see Josh explain the law, and then read on for further information.

Here is what we know thus far:
Employers that will be considered “covered” if they:

• Have more than 5 employees in the state of Nevada.
• Have been in business for at least 36 months.
• Have not offered a qualified retirement plan in the 3 years immediately before the
  start date of the plan.

Employees that will be considered “covered”:

• Are employed by a covered employer for not less than 120 days.
• Has wages or other compensation that is allocable to the state.
• Is at least 18 years of age.

Covered employers must automatically enroll all covered employees in the program:

• Contributions to a covered employee must be withheld at a rate set by the Board unless the employee:
  • Chooses to opt out of the plan.
  • Changes the contribution rate.
  • Employees can withdraw contributions to meet a financial or other emergency.

A few key items of note, per the Bill:

• “Neither a covered employer nor the State will monitor or has an obligation to monitor the covered employee’s eligibility under the Internal Revenue Code to make contributions to an Individual Retirement Account or to monitor whether the covered employee’s contributions to the Individual Retirement Account established or maintained for the covered employee through the program exceed the maximum permissible Individual Retirement Account contribution.” (Sec.23.9. (g))
  • Explanation: Individual Retirement Accounts have annual contribution limits that are set by the IRS. If an employee is already contributing to an IRA (Roth or Traditional) – this could open the possibility of overcontributing. When you work with a team of advisors, we can help you and the employees to ensure they do not overcontribute and assist with the different types of retirement accounts they are eligible to contribute to.
• “The underlying investments of each investment fund must be diversified so as to minimize
  the risk of large losses under any circumstances.” (Sec.26.4.)
  • Explanation: Retirement plans will frequently utilize conservative investments which can be an option for investors who are risk adverse. The key point here is that someone who is 25 compared to someone who is 65 will have vastly different time horizons and their investments should align as such.

Overall, when you decide to use a team of Financial Advisors, you and the employees can receive a higher level of service and a more customized approach to retirement planning. Rather than a one-size-fits-all approach, we take the time to meet with each employee and customize a plan based on their goals.

Talk with the Jackson & Whitaker team today about a customized approach to retirement planning
for your employees.

Next Steps
Reach out to us to understand how this bill affects your business, and the steps you need to take. Jackson & Whitaker contact information:

• Phone number: (775) 782-5061
• Email: josh.larson@lpl.com
• Address: 1701 County Road, Suite O, Minden, NV 89423
• Contact us online