Configuring Savings Plans

Objective

After completing this lesson, you will be able to configure a savings plan.

Savings Plans

An Employee Savings Plan allows employees to save a percentage of their eligible pay, up to legal limits, toward their medical expenses or other authorized goals. Your organization can elect to contribute on a before-tax basis, an after-tax basis, or a combination. Savings plans are only available in the United States.

Examples of savings accounts include 401(k), 403(b), and Health Savings Account (HSA) plans.

Fields specific to Savings Plans

When you set the Benefit Type to Savings Plan, the Specify Plan Details section displays several fields specific to this type of plan.

  • Country/Region: Currently, the only option is United States. Select this option to display the following fields.
  • Plan type: The type of savings plan. Choices include Health Savings Account (HSA), Flexible Spending Account (FSA), or Dependent Care Reimbursement Account (DCRA).
  • Catchup Option is a type of investment that allows people of a certain age to make additional contribution based on legally mandated IRS limits.
  • Beneficiary Relevant: Select this option if this plan is relevant for a beneficiary. When you choose Yes, the employee is allowed to choose a Primary Beneficiary and Contingent Beneficiary.
  • Coverage Tier: You can configure multiple coverage tiers. When an employee’s coverage tier changes due to a life event such as marriage, contributions are automatically prorated.
    • Annual Minimum Contribution Amount
    • Annual Maximum Contribution Amount
    • Enable Employer Contribution
    • Employer Contribution: This is used to calculate the entitlement amount for an employer contribution based on when the employee joins the HSA, and calculates the employee annual contribution maximum based on the overall annual plan limit set by the admin. You can configure lump sum or periodic lump sums.
    • Employer Contribution Pay Component
    • Annual Maximum Contribution Pay Component
    • Employee Annual Limit Pay Component
  • Deduction Details:
    • Base Salary Pay Component
    • Pay Frequency
    • Deduction Pay Component

Savings Plan Pay Components

When configuring a Savings Plan benefit, two Pay Components are needed. The first is for the contribution to the fund, and the second is for annual minimum and maximum contributions. This is because the first pay component must be recurring, and the second one must be non-recurring.

Create a Savings Plan

Business Example

You are configuring a new savings plan for your organization's Health Savings Account (HSA).

Task 1: Create the Schedule and Schedule Period for the Savings Plan

ExerciseStart Exercise

Steps

  1. Create a new benefit using the data in the following table:

    FieldValue
    Benefit TypeSavings Plan
    Benefit IDHSA
    Benefit NameHSA
    Benefit Short DescriptionHSA
    Effective From01/01/2025
    StatusActive
    CurrencyUSD
    Integration ModeBenefit Objects
    Deduction Start DateNo Selection
    Legal EntityAce USA
    Benefit Schedule2025 Savings Plan Schedule
    Enrollment RequiredYes
    Days Remaining to EnrollShows
    Enrollment TypeManual
    Country/RegionUnited States
    Plan TypeHealthSavings Account/HSA
    CatchupOptionSavingsCatchup
    Annual Maximum Pay ComponentHSALimits
    Employee Annual Limit Pay ComponentHSALimits
    Coverage TierEmployee
    Annual Minimum Contribution100
    Annual Maximum Contribution2500
    Base Salary Pay ComponentHSA Contribution
    Pay FrequencyMonthly (MON)
    Deduction Pay ComponentHSA Contribution

    1. Use the Action Search and navigate to Benefits Admin Overview.

    2. Select Create New→Benefit.

    3. Enter the data from the table.

    4. Enter a Coverage Tier.

    5. Select Save.

  2. Confirm if the benefit Savings Plan is showing up in the People Profile.

    1. From the Menu, select Home.

    2. Select the Manage my Benefits tile.

    3. Verify the HSA Savings Plan appears under the Benefits Available to Enroll tile.

Summary

  • An Employee Savings Plan allows employees to save a percentage of their eligible pay, up to legal limits, toward their medical expenses or other authorized goals..
  • Examples of Savings Plans include 401(k), 403(b), and Health Savings Account (HSA) plans, available only in the U.S.
  • Employee Savings Plans are only available in the United States.

Learning

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