Retirement Plans For Small Businesses

There are a number of different plans and variations of plans that are applicable to small businesses. This analysis will concentrate on the four major plans.  These plans fall into two categories:

Plans generally funded by employer contributions (such as SEP-IRAs and Keoghs) - where the business contributes the same percentage of compensation for you and any eligible employees you may have
        Summary of SEP-IRA Plans
        Summary of Keogh Plans

Plans generally funded by employee elective deferrals and employer contributions (such as 401(k) and SIMPLE Plans) - where employees have an opportunity to defer part of their salary to fund their retirement plans - on a tax-advantaged basis.
        Summary of 401(k) Plans
        Summary of SIMPLE-IRA Plans

Determining which of these retirement plans is most appropriate for your business is complex and you should discuss your specific situation with a qualified professional. Some specific points you’ll want to consider are:

  1. How much, if any, responsibility do you want to have for contributing to your employees’ retirement plans?
  2. What percentage of compensation do you and your employees want to be able to contribute each year?
  3. How much does each plan require you to contribute to the plan on behalf of your employees?
  4. Are you willing to assume some additional administrative responsibilities and costs for your retirement plan in exchange for more flexibility?
  5. What are the administrative costs for this type of plan?
  6. What type of investment flexibility does the plan provide and who is responsible for investment decisions?

© Copyright 2000 Raymond S. Kulzick. All rights reserved. 000101.

This publication provides business, financial planning, and/or tax information to our clients. All material is for general information only and should not be acted upon without seeking appropriate professional assistance.

Home

Main Page

Contact

Search
Contact rkulzick@kulzick.com with questions or comments about this web site.
Copyright © 2000 Kulzick Associates, PA - Last modified: September 13, 2008