No matter the job market temperature, offering retirement savings benefits to employees can help small businesses level the playing field when competing for top-tier talent. Pensions and other traditional retirement vehicles often prove too expensive for smaller operations. However, a 401(k) plan delivers an ideal way to invest in employees without stretching internal resources too thin.
Key Considerations When Selecting a 401(k) Plan for Small Business Employees
Recent legislation coupled with cutting-edge technology has expanded available online 401(k) plan options for small business owners. However, it’s important to know that not every digital retirement savings platform is created alike. With so many available products to choose from, finding the right plan can feel overwhelming. Knowing some of the most critical factors to look for when comparing potential 401(k) benefits programs can help you make an informed final decision.
Some key considerations when finding the right 401(k) plan for your small business should include:
As with any professional investment, the cost will play a significant role in the decision-making process. Some online 401(k) plans claimed to be designed for small businesses — however, many don’t appear to be priced for small businesses. A program that offers a flat rate per plan participant and no hidden fees is a great way to keep a steady focus on the overall return on investment.
- Payroll Integration
Most small business leaders don’t have the time or resources to process payroll on its own; adding a 401(k) plan can mean extra time and energy spent transferring data from their payroll tool into an added retirement savings plan. When sourcing 401(k) savings plans, look for a provider that offers seamless payroll integration with your existing platform. An automated digital option eliminates manual entry and reduces the risk of data entry error from payroll to plan.
- Safe Harbor Plans
A Safe Harbor plan allows employers much more flexibility in contributing themselves, and also providing them with an exemption from nondiscrimination testing. Matching employee contributions not only reduces your business taxes at the end of the year, but accentuates the retirement benefit for everyone enrolled. Partnering with a provider with experience setting up Safe Harbor plans can help keep your business compliant with current rules and regulations.
- Easy Signup
A fast, straightforward setup process is a must for small business owners who are typically tasked with multiple roles and responsibilities. Even organizations with a designated HR department can benefit from using a product that accelerates matriculation. Look for a full-service provider that can automate as much of the process and puts the control in employees’ hands.
- Personalized User Experience
When choosing an online 401(k) plan for your small business, it’s easy to get caught up in the technology. Yes, innovation is essential for automation and integration. However, saving for retirement is a personal process that doesn’t offer a one-size-fits-all solution. A leading provider of 401(k) savings plans will not only offer the tools; they will provide a personalized user experience with easy-to-access staff members who are available to troubleshoot and answer questions to lower the stress associated with retirement savings.
- Seamless Tech & Touch
Technology is important but optimal outcomes are the result of engaged, human advisors working in conjunction with the innovation and automation of the system. Look for a provider that adjusts their advisory input based on your specific needs. The right provider will be able to encourage and support collaborating with outside advisors if your business already has one, set your business up with an advisor if you’d like, or provide limited input as needed if you feel like your employees are able to manage on their own.
Make 401(k) Savings Easy, Fun, and Personal
401GO simplifies the 401(k) retirement savings process for business owners, HR professionals, and employees.