Tips for SMB Owners: 3 Crucial Things to Know About Employee Retirement
Aside from some of the obvious differences between small and big businesses, like number of employees, office size and gross revenue, another way these two differ is in the percentage of workers who have retirement plans.
Statistics show that in office settings with fewer than 50 employees, less than half the workers had any kind of pension or retirement plan established, while businesses with 500 or more employees had more than 90% invested in some kind of retirement plan.
While you may think that setting up such a plan doesn’t make sense for your small business and will be more trouble than it’s worth, nothing could be further from the truth. In fact, many small business owners are now seeing the importance of having this plan. Setting up a retirement plan these days can be extremely easy to do and a qualified representative can help take care of all the details and help manage it online simply and easily.
Here are 3 crucial things small business owners need to know about employee retirement:
- Employees want it-Recent surveys conducted in small businesses across the country, while the majority stated increased wages were their #1 want, a 401k plan or similar was a close second. Many stated that had no plan set up whatsoever and would be willing to contribute at least something from each paycheck to help support such an investment.
- Securing an employee retirement fund will increase their investment in the company-Along with the security will feel about their own retirement, securing an in-house investment program will go a long way in helping employees feel better about their job and more invested in the company. Such a benefit can help employees feel more secure and connected to the business when there is a retirement plan offered as part of their benefits. They see the money they are investing with each and every paycheck and morale can increase as well as they begin to feel more secure about their own retirement.
- The tax benefits to your business can be amazing as well-It’s not just the employees who benefit when your small business established a 401k or similar retirement plan. Recent tax laws established will offer the business up to $16500 in tax credits realized in the first 3 years that the plan is set up. Coupled with the fact that the business could take part in the retirement plan as well as funnel a portion of the business’s profits into the 401k plan, establishing such a retirement account can be a positive for all involved.
No longer is setting up a retirement plan an arduous process filled with endless paperwork and visits with financial advisors. These days, so much is available online to help setup and manage the plan that the process is incredibly simple. As you can see from the above, the benefits can be significant as well. So if you want to reap the benefits of setting up a 401k plan for your small business and provide a valuable benefit for your employees AND your business, contact an investment firm today, and begin helping others and your business save for the future.