State plans
Some states now require, or are considering requiring, employers to join a state-controlled retirement program if they don’t offer their workers a retirement plan. But a state-sponsored plan is just one of many options.
State-by-state status is compiled from Georgetown University’s Center for Retirement Initiatives as of December 1, 2025. For more details about your state’s plan and its current legislative status, go to cri.georgetown.edu/states/.
Alternative solutions
While a state-run program can help more people save for retirement, there are several low-cost alternatives.
Read more about state-sponsored plans and alternative solutions
Capital Group’s retirement plan solutions are scaled to fit a range of clients.
AUTO-IRA
ELIGIBILITY
Varies by state
MAXIMUM PARTICIPANT CONTRIBUTIONS FOR 2026
$7,5001
$1,100 catch-up for age 50 or older
EMPLOYER CONTRIBUTIONS
Not permitted
SEP IRA
ELIGIBILITY
Any employer or sole proprietor
MAXIMUM PARTICIPANT CONTRIBUTIONS FOR 2026
None
EMPLOYER CONTRIBUTIONS
Discretionary4
Cannot exceed the lesser of 25% of compensation or $72,0007
SIMPLE IRA
ELIGIBILITY
Employers with 100 or fewer employees
MAXIMUM PARTICIPANT CONTRIBUTIONS FOR 2026
$18,100 / $17,0002
$3,850 / $4,0002
catch-up for ages 50-59 and 64+
$5,250 catch-up for ages 60 to 633
EMPLOYER CONTRIBUTIONS
Mandatory5; either:
• Dollar-for-dollar match of up to 3% of compensation6, or
• Across-the-board contribution of 2% of compensation7
401(k)
ELIGIBILITY
Any employer (except governmental entities)
MAXIMUM PARTICIPANT CONTRIBUTIONS FOR 2026
$24,500
$8,000 catch-up for ages 50-59 and 64+
$11,250 catch-up for ages 60 to 63 only3
EMPLOYER CONTRIBUTIONS
Discretionary
Total contributions cannot exceed lesser of 100% of compensation or $72,000 (or $80,000 with catch up
contributions, or $83,250 with higher catch-up contributions)3
Footnotes/Important information:
1 Income restrictions apply to Roth IRA contributions and to tax deductions on traditional IRA contributions.
2 The first limit shown applies to smaller employers (those with no more than 25 employees who earned at least $5,000 in the prior year), and larger employers (those with more than 25 employees who earned at least $5,000 in the prior year) if increased employer contributions are made.
3 The higher catch-up limit is only applicable to participants who attain ages 60, 61, 62, or 63 in 2026.
4 Employer SEP IRA contributions must be the same percentage for every employee.
5 Employers may also make an optional across-the-board non-elective contribution above the mandatory contributions, which must be made to all eligible employees and cannot exceed the lesser of 10% of compensation or $5,300.
6 SIMPLE IRA matching contributions may be reduced to a minimum of 1% for two of every five calendar years.
7 Compensation on which the employer calculates the maximum contributions is limited to $360,000 for 2026, except for SIMPLE IRA matching contributions.
AUTO-IRA
SEP IRA
SIMPLE IRA
401(k)
Eligibility
Varies by state
Any employer or sole proprietor
Employers with 100 or fewer employees
Any employer (except governmental entities)
Maximum participant contributions for 2026
$7,5001
None
$18,100/$17,0002
$24,500
$1,100 catch-up for age 50 or older
none
$3,850/ $4,0002 catch-up for ages 50-59 and 64+
$5,250 catch-up for ages 60 to 633
$8,000 catch-up for ages 50-59 and 64+
$11,250 catch-up for ages 60 to 633
Employer contributions
Not permitted
Discretionary4
Mandatory5; either:
Discretionary
Cannot exceed the lesser of 25% of compensation or $72,0007
• Dollar-for-dollar match of up to 3% of compensation6, or
• Across-the-board contribution of 2% of compensation7
Total contributions cannot exceed lesser of 100% of compensation or $72,000 (or $80,000 with catch up
contributions, or $83,250 with higher catch-up contributions)3
Footnotes/Important information:
1 Income restrictions apply to Roth IRA contributions and to tax deductions on traditional IRA contributions.
2 The first limit shown applies to smaller employers (those with no more than 25 employees who earned at least $5,000 in the prior year), and larger employers (those with more than 25 employees who earned at least $5,000 in the prior year) if increased employer contributions are made.
3 The higher catch-up limit is only applicable to participants who attain ages 60, 61, 62, or 63 in 2026.
4 Employer SEP IRA contributions must be the same percentage for every employee.
5 Employers may also make an optional across-the-board non-elective contribution above the mandatory contributions, which must be made to all eligible employees and cannot exceed the lesser of 10% of compensation or $5,300.
6 SIMPLE IRA matching contributions may be reduced to a minimum of 1% for two of every five calendar years.
7 Compensation on which the employer calculates the maximum contributions is limited to $360,000 for 2026, except for SIMPLE IRA matching contributions.
Our products
SEP IRA
For sole proprietorships and businesses with few employees.
SIMPLE IRA
Affordable, easy solution for businesses with 100 or fewer employees.
SIMPLE IRA Plus
401(k)-style features at a SIMPLE IRA price, exclusive to Capital Group.
RecordkeeperDirect®
A low-cost 401(k) solution designed for startups and smaller plans.
PlanPremier®
A full-featured 401(k) solution designed for plans of all sizes.
Resources
Use the following resources to learn more as you and your clients weigh retirement plan options.
Are tax credits available?
Expanded tax credits could significantly defray the cost of starting a plan.
How are participants supported?
Financial professional support and engaging tools, like our ICanRetire® site, can help participants stay on track.
How are the plan investments managed?
Quality plan menus can make a difference in participant outcomes. Explore what sets Capital Group’s investments apart.
Boosting retirement savings using new tools
The current state of state-sponsored retirement plans
Build a better 401(k) for your clients
Trust in a proven leader
Our target date series has “Thrilling” underlying strategies.‡
We were selected most often by advisors managing less than $50M in DC AUM as a “company I trust” and “easy to do business with.”§
Ready to get started?
We’re here to help.
Give our team of dedicated retirement plan specialists a call today.
888-777-1579
Footnotes/Important information:
§ Escalent, Cogent Syndicated, Retirement Plan Advisor Trends™, October 2025. Methodology: 411 respondents participated in a web survey conducted September 8-19, 2025. For “Ownership” of Core Brand Attributes — Tier 1, among 227 financial advisors managing less than $50M in defined contribution (DC) assets under management (AUM), Capital Group | American Funds was selected most often in response to the question, “Which — if any — of these DC plan providers are described by this statement … ‘is a company I trust' and ‘easy for advisors to do business with’?” Capital Group has provided input on some of the questions to be included in Cogent surveys over time. Additionally, Capital Group has made a subscription investment to Cogent Syndicated to access a detailed version of the Retirement Plan Advisor Trends report.
‡ Source: Morningstar, “The Thrilling 33” by Russel Kinnel, August 13, 2025. Morningstar’s screening took into consideration expense ratios, manager ownership, returns over manager's tenure, and Morningstar Risk, Medalist and Parent ratings. The universe was limited to share classes accessible to individual investors with a minimum investment no greater than $50,000, did not include funds of funds, and must be rated by Morningstar analysts. Class A shares were evaluated for American Funds. Visit morningstar.com for more details. Not all six funds listed in the “The Thrilling 33” list are in each target date fund. Underlying funds may change over time.