| A small business 401k has a design to provide | | | | for dollar up to three percent of their |
| your business with the resources it needs to | | | | compensation. |
| offer your employees a retirement plan. The | | | | When you do contribute, your contributions |
| 401k retirement plan is one of the best options | | | | are tax deductible. |
| available to individual's today. As a business owner, | | | | Consider vesting. If you want to put your |
| you have options. The IRS has put in place a | | | | money into an employee but you want to |
| number of different types of 401k plans that | | | | safeguard those funds to keep the employee |
| make it highly affordable for business owners to | | | | working for you, consider vesting the money. |
| offer this option to their employees. Statistics | | | | Over time, the amount of vesting increases until |
| show that employees are most likely to be loyal if | | | | the employee reaches 100 percent at which time |
| their employer provides them with important | | | | all employer contributions are available to the |
| benefits, including retirement plans. | | | | employee. |
| Your Options | | | | The rules for establishing a 401k are not as |
| There are a number of 401k retirement plan | | | | difficult as you may think and the costs overall |
| options available to small business owners. In | | | | are minimal for doing so. As mentioned, there are |
| short, there are a variety of ways for you to | | | | tax benefits to the employer and employees may |
| customize this plan to have more options. | | | | be encouraged to stay with your company if you |
| Consider the following options you have. | | | | offer them a retirement plan. Best of all, you can |
| The employer can elect the types of | | | | shop around for the right investment firm to |
| contributions they wish to make. You decide if | | | | obtain the 401k plan from, which means you have |
| you want to contribute to the employee's plan or | | | | plenty of options to select from and lower costs |
| not. | | | | due to the competition. |
| If you do decide to contribute, under the | | | | As a small business owner, you may have |
| traditional 401k plan, you determine what | | | | thought that you simply could not offer your |
| percentage of the employee's compensation you | | | | employees any type of retirement plan. That is |
| wish to contribute. | | | | not the case. In fact, you are likely to find |
| Consider the safe harbor 401k plan where | | | | yourself with opportunities to tailor a plan that |
| you can match the employee's contributions dollar | | | | works for your small business 401k needs. |