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When discussing retirement plans, you’re always going to run into 401(k)s. It is certainly the plan we are most familiar with and is usually the plan of choice for major enterprises, but it’s not only for the big guys. In fact, any business entity can establish a 401(k) plan.
The SIMPLE IRA or the Savings Incentive Match Plan for Employees is like a 401(k) plan but involves less administrative complexity and potentially lower maintenance fees. Despite this advantage, there are several restrictions and commitments that should be considered when looking into a SIMPLE IRA plan.
The life of a business owner is filled with tremendous responsibility and requires your full attention. As a business owner, you are left with little time to be an expert in investments, markets, and knowing the ins and outs of business retirement plans. The first step in this process is asking yourself the commitment question:
The SEP IRA or Simplified Employee Pension Plan is different than a 401(k) or SIMPLE IRA retirement plan. This type of plan provides for greater contribution amounts, greater flexibility when it comes to contributions, and little restrictions.
