In terms of smaller businesses, 401k plans can seem rather costly. The well-known 401k providers almost across the board gear their products to bigger companies that have the budgets for them. Things are starting to shift, however. Plan prices have come down. Automated administration of 401k's is making such programs far more manageable, thus doable, for small businesses.
Offering a 401k in many instances can help you to attract a better caliber of employee. This is one benefit that job applicants are really starting to expect. Plus, in providing your employees with a retirement plan, you are eligible for certain tax benefits that could help offset the associated costs.
There are new companies out there who are streamlining the retirement plan process for smaller businesses. They are making the administrative side of the 401k incredibly easy; not to mention, they offer a comprehensive system when it comes to things like managing the funds, withdrawing money, and enabling both you and your employees to access and evaluate their accounts.
By giving employees a benefit like a 401k plan, you are also establishing the fact that you are in fact invested in their well being. This, in turn, tends to keep your team members happier, more motivated and loyal to your business. It's most definitely a tool for attracting and retaining talent. And in this competitive job market, you need all the tools you can get.
There are also, of course, the tax advantages of 401k plans. Employees are putting pre-tax money into this savings account. When they do go to draw on it upon retirement, the rate they will pay versus a capital gains rate is far more favorable for them. And subsequently, if you match their contributions, you get to deduct this and thus realize substantial tax savings. You can also do this with your own contributions given that you are considered an employee of the company as well.
There are numerous benefits to setting up retirement plans for your employees. The costs are coming down and the advantages definitely seem to be worth it. If you need additional funds as you look into establishing 401k plans, First Union Lending can certainly help. Call today to see what type of commercial financing we can offer you!