MarylandSaves vs. setting up your own plan
MarylandSaves is the state's answer for employers who offer nothing: a payroll-deduction Roth IRA arrangement your employees are enrolled into, with no employer contribution and almost no work for you. Sponsoring your own plan takes more setup and gives you higher contribution limits, the ability to contribute for your team, and design choices like vesting. If your goal is compliance, the state program does that. If your goal is keeping people, your own plan does more.
They are answering different questions
The comparison gets muddled because people treat these as two versions of the same thing. They are not.
MarylandSaves exists to solve a public policy problem: a lot of people reach retirement with nothing saved because their employer never offered a route. It is designed to be nearly frictionless for the employer, which necessarily means it is limited.
Your own plan exists to solve your problem, which is usually some combination of saving meaningfully yourself and keeping the people you cannot afford to lose.
If you ask which is better, the answer depends entirely on which of those two problems you are actually trying to solve.
Side by side
| MarylandSaves | Your own plan | |
|---|---|---|
| Employer contribution | None | Optional or required depending on plan type |
| Contribution limits | IRA limits, which are lower | Higher, and considerably higher with a 401(k) |
| Setup effort | Minimal, by design | More, and it varies a lot by plan type |
| Design choices | None. It is what it is. | Vesting, matching formula, eligibility, Roth options |
| Whose benefit it looks like | The state's | Yours |
| Satisfies the mandate | Yes | Yes |
The recruiting difference is not on that table
Here is the thing owners tend to discover afterwards. An employee enrolled in a state program does not experience it as something you did for them. They experience it as a deduction that appeared.
A plan you sponsor, particularly one where you contribute something, reads completely differently in a job offer and in the conversation where somebody is deciding whether to stay. That difference does not show up in a compliance comparison and it is often the reason the extra effort is worth it.
If you go your own way, which plan
That is the next question and it has its own answer. A SIMPLE IRA is light on administration and suits most small teams. A 401(k) allows higher contributions and real design control at higher cost. A SEP suits an owner with no staff and gets expensive quickly once you have employees.
We laid out all four options, what each asks of you, and how to tell which is yours, on the retirement plans page.
A worked example
A six-person business with employees in Maryland, currently offering nothing, aware a deadline exists.
Registering with MarylandSaves takes care of the obligation and costs almost nothing in effort. Done. The owner is compliant.
But the owner also wants to save meaningfully himself, and the IRA limits inside the state program will not let him. And he has two people he cannot afford to lose. A SIMPLE IRA lets his team contribute more, lets him contribute for them, and reads as his benefit rather than the state's. It takes an afternoon to set up.
Same obligation, satisfied either way. Different outcomes for what he was actually trying to achieve.
Where we fit
We work through headcount, payroll, turnover, and what you can commit to every year without flinching. Then we weigh the options together, with your CPA in the conversation on the tax side, including any startup credits you may qualify for. You choose. We handle setup and payroll coordination and sit with your employees to explain what they are signing up for.
This is general education about the programs and plan types, not tax or legal advice and not a recommendation about your business. State program rules change, so we confirm the current requirements against your specific situation before you file anything.
While we are on the subject.
What is MarylandSaves?
A state-facilitated retirement savings program for employers who do not offer a plan. Employees are automatically enrolled into a payroll-deduction Roth IRA arrangement and can opt out. There is no employer contribution and the administrative burden on you is deliberately light.
Do I have to use it?
No. Most established Maryland employers must either register with the state program or offer their own qualifying retirement plan. Sponsoring your own is the alternative, not an additional obligation.
What does my own plan do that the state program does not?
Higher contribution limits, the ability to contribute for your employees as a match or otherwise, design choices such as vesting schedules and Roth options, and a benefit that reads as yours rather than the state's when you are recruiting.
Is my own plan much more work?
More than the state program, less than owners expect. A SIMPLE IRA is close to a form and a payroll entry. A 401(k) carries real administration and cost. Which suits you depends on headcount, budget, and how much administration you will genuinely tolerate.
What about Pennsylvania?
Pennsylvania's Keystone Saves program is enacted and phasing in behind Maryland's. If you employ people in PA and offer nothing today, a deadline is heading your way and the same choice applies.
Bring us the version of this question that is actually yours.
The first conversation is free, and it stays in plain English.
Book a conversation