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Employee benefits and retirement plan solutions Trends and Insights 3 cost-effective ways small business owners can start a retirement plan for employees

3 cost-effective ways small business owners can start a retirement plan for employees

Offering a retirement savings plan can help employees feel valued and more financially secure. Walk through three options that help simplify the process.
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2 min read |

Considering starting a retirement plan for your employees鈥攂ut concerned your organization is too small or a plan will be too expensive? You鈥檙e not alone.

Fortunately, starting a small business 401(k) plan could be free with tax credits to cover both the start-up costs and offset matching contributions, thanks to SECURE 2.0 legislation.

Taking advantage of these tax incentives can also help you attract and keep top talent: Employees say after health care, a retirement plan is the most important benefit employers can provide, according to 海角社区Financial Well-Being Index.

Here are three realistic small business retirement plan options that can help simplify the process and reduce required resources.

1. Streamline your efforts with a digital, self-serve retirement plan.

Automated options help simplify the initial plan design and purchase process. And ongoing administration is typically quick and efficient.

With , for example, you can get a plan up and running in just a few weeks. While everything can be done online, help is just a phone call away if you need it.

2. Outsource maintenance and access scaled pricing by joining other employers in a plan.

A multiple employer plan (MEP) or pooled employer plan (PEP) is a plan set up for several employers to use at once.

By joining forces with other employers, you can take advantage of group pricing and reduce your involvement by outsourcing time-consuming administrative tasks. This option also shifts some of the fiduciary risk and investment responsibilities off you and onto the plan provider. SECURE 2.0 tax perks apply when you join, even if the plan previously existed.

Ask your financial professional about our PEP offering, Principal庐 EASE. If you don鈥檛 already have one, we can help connect you to a financial professional in your area.

3. Lean on a retirement plan professional.

Prefer to set up your own small business retirement plan? Financial professionals, third-party administrators, and plan service providers can provide support on every step of decision-making and tailor your benefits based on your business plan and budget.

They can help you understand your options and ensure you鈥檙e getting the most out of SECURE 2.0.

What鈥檚 next?

Take the next steps to help grow your business.

Attracting & retaining my workforce
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Footnotes

This article is intended to be educational in nature and is not intended to be taken as a recommendation. Simply 海角社区 by Principal庐 401(k) plan recordkeeping, and administrative services are provided through Decimal, Inc. dba Ubiquity 海角社区 + Savings (鈥淯biquity鈥). Ubiquity is not affiliated with any plan and investment administrative services provided through 海角社区Life Insurance Company庐 or affiliated with any company of the 海角社区Financial Group庐. 海角社区makes available the Separate Accounts and collective investment trusts for customers to select them through Simply 海角社区 by Principal. All other services and mutual funds are provided by service providers not affiliated with any company of the 海角社区Financial Group. Refer to related documents and agreements for more details on plan services available. Mutual fund, separate account and collective investment trust trade instructions are processed by Matrix Settlement & Clearance Services, LLC through the NSCC Membership of its affiliate, Matrix Trust Company.

Simply 海角社区 by Principal庐 requires a client service agreement between Ubiquity and the plan sponsor (Customer). In addition to and as part of the services, each Customer will sign separate agreements with the following parties: (i) custodian (ii) 3(38) investment manager, and (iii) 海角社区Life Insurance Company, a Comprehensive 海角社区 Program (PCRP) offered through the Modular Group Annuity Contract for separate accounts, and a declaration of trust for 海角社区collective investment funds. Simply 海角社区 by 海角社区services, costs and resources are subject to change.