401(k) For Small Business in Country Life Acres, MO

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401(k) for small business in Country Life Acres, MO. Setting up a 401(k) plan for your small business in Country Life Acres, MO can offer various benefits to both you and the people that work for you, helping businesses stand out and provide long-term financial security to their employees. Beyond just offering more benefits than competitors, offering a 401(k) plan can also help both businesses and employees lower their tax liability. But, some business owners may still be wary because of the time commitment, as well as the complexities of investment and financial laws.

At Correct Capital Wealth Management, our Country Life Acres, MO financial planners and retirement consultants help companies of all sizes offer customized and successful 401(k) plans. We do most of the work for you while you focus on your business. Call Correct Capital today at 877-930-4015 or complete our online form to get started with establishing a 401(k) for your small business in Country Life Acres, MO.

Should I Establish a 401(k) For My Country Life Acres, MO Small Business?

Establishing and maintaining a 401(k) for a small business in Country Life Acres, MO can do wonders for you, your workers, and your business goals alike:

  • Attract and keep great employees — Offering a 401(k) plan can be an important asset for recruiting and keeping top talent, particularly in a competitive Country Life Acres, MO job market. Employees see a 401(k) as a valuable benefit, and offering one can help your business stand out, especially if you offer 401(k)s to rank-and-file employees as well.
  • Tax deductions — Both businesses and employees can reduce their tax liability with a 401(k) plan. Matching contributions employers make are tax deductible up to the yearly corporate tax deduction limit on employer contributions, which is 25% of covered payroll. The federal government also offers tax credits for first-time 401(k) plans and offering automatic enrollment. Employees enjoy tax-deferred contributions and potentially reduce their taxable income.
  • Increased financial security for employees — A retirement account allows employees to feel more confident about how they'll live in retirement. Greater financial security eventually leads to more productivity.
  • Reduced liability — Employers take on a fiduciary duty to their employees when they offer retirement plans, which involves a wide range of investment comprehension and obligations. If you partner with an ERISA 3(38) Fiduciary advisor to assist you with your small business's 401(k), most of that liability will go to them.
  • Ease of administration — When you offer your small business 401(k) plan with a 3(16) administrator, they'll handle the vast majority of employee education, compliance, and administrative tasks on your behalf, so you can enjoy the rewards of offering a plan without much hassle. Additionally, advisors can help with 401(k) payroll integration for further simplicity. If an employee moves to a new company, they can effortlessly rollover their 401(k) to an IRA or new 401(k) without you having to do much work.

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Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.

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What 401(k) Plans Are Available to Small Businesses in Country Life Acres, MO?

Small businesses, depending on what type of company they are, can have anywhere from one to 1,500 employees. However many employees you have, there is a 401(k) plan that will work for you:


401(k) Plans

In any 401(k) plan, employees can contribute through payroll deductions. Most 401(k)s offer a wide range of investment opportunities. Employers can employers can deposit an equal amount as their employees as an added benefit to employees. Most 401(k) plans must follow stringent nondiscrimination requirements, and perform annual tests to ensure the plan doesn't favor highly compensated employees. The IRS mandates contribution limits each year; in 2023 the limit is $22,500, unless you turn 50 or older this year, in which case the limit is $30,000.

Country Life Acres, MO businesses with multiple employees have a few different options in how they set up their 401(k) plan:

  • Traditional vs. Roth 401(k) Deferrals — The key difference between traditional and Roth deferrals is the tax benefits. With a traditional deferral, contributions are tax-deferred, meaning the contributions are made before taxes are taken out, and the employee can then deduct the amount deposited from their taxable income. Taxes are paid when the money is withdrawn.

    With Roth deferrals, contributions are made with after-tax dollars, meaning the money grows tax-free and there are no taxes when the money's withdrawn, so long as the plan participant has been contributing for at least five years and is 59-½ years old when the money is taken out. Roth 401(k)s are becoming increasingly popular as they allow plan participants to diversify their tax exposure in retirement.

  • Safe Harbor Provision — If you opt for this provision, as an employer you would be obligated to make contributions that are fully vested when made. To meet Safe Harbor requirements, you have four possible ways to contribute:
    1. In a non-elective contribution, an employer must contribute 3% of each eligible employee's compensation to the plan, regardless of whether the employee chooses to contribute to the plan.
    2. With matching contributions, the employer must match 100% of each eligible employee's contributions up to 3% of their compensation, plus an additional 50% match on the next 2% of their compensation.
    3. Enhanced Safe Harbor plans provide a 100% employer match on up to 4% of an employee's compensation.
    4. In a Qualified Automatic Contribution Arrangement (QACA), employees are automatically enrolled in the plan and have a portion of their pay contributed to the plan unless they decide not to. The default contribution rate starts at 3% and increases by 1% every year until it maxes out at 6%, unless the employee elects a different contribution rate.

    In exchange for obligatory employer contributions, Safe Harbor plans are not subject to nondiscrimination testing.

Solo or Individual 401(k) Plan

These are intended for owner-only businesses, or a business where the only employee is a spouse. Contributions can be deducted from taxable income and gains grow tax-deferred until the money is taken out. This type of retirement account allows individuals to make contributions both as an employer and as an employee, providing higher contribution limits than many other individual-based retirement plans. Unlike other 401(k) plans, individual 401(k)s do not require annual filings with the IRS unless the account balance exceeds $250,000.

What plan works best for your and your employees depends on your business and your and your employees' needs. If you're considering opening a 401(k) plan for your small Country Life Acres, MO business, schedule an appointment with a member of our advisor team today to get started.



How a Financial Advisor Can Help Your Country Life Acres, MO Small Business With Your 401(k) Plans

Given the benefits of a small business offering a 401(k) plan, some Country Life Acres, MO employers might still be uneasy, as managing a 401(k) plan is complex and time-consuming. That’s where a financial advisor can help. Here are some ways that our advisory firm can help make your life easier in regards to your small business's 401(k) plan:

  • Plan design — A few detailed Google searches can't come close to offering the same degree of skill and experience as a licensed advisory firm. Financial advisors can work with small business owners to develop a 401(k) plan that meets the specific needs of their business and employees. They can help choose the plan that most benefits you, set up contribution and matching formulas, and establish eligibility requirements.
  • Setting up and operating a plan — There are specific steps you must take when initiating your small business 401(k). You must:
    • Adopt a written plan document
    • Arrange a trust fund for plan assets
    • Establish a record keeping system
    • Provide plan information to eligible employees

    A financial advisory firm can do all of that for you, and oversee the operation and yearly reviews of the plan.

  • Marketing your 401(k) plan to prospective employees — The term "401(k)" might show up on a job listing in a list of benefits, but many in the job market don't fully understand what a 401(k) can do for them. We can connect the words "401(k)" to definite images of a more secure retirement, with a clear road map of how to get there.
  • Investment selection — Financial advisors who are an Accredited Investment Fiduciary® (AIF®) and are qualified to perform portfolio management will be able to offer market insight, as well as work within investment principles such as diversification, risk tolerance, and rebalancing to optimally position employees' savings for further growth.
  • Employee education — The more an employee understands their 401(k) plan, the more it will benefit them. At Correct Capital, we offer both group classes and one-on-one counseling sessions with our small business clients' employees so they're confident with the status of their retirement savings.
  • Compliance — 401(k) plans have different rules and contribution limits. Not following them can lead to harsh fees. A financial advisor can help to ensure all of the proper rules are followed.
  • Fiduciary responsibility — As a plan sponsor, small business owners have a fiduciary duty to act in the best interest of their employees. We are ethically and legally bound to do what's in your best interest, and in the best interest of your employees and their retirement accounts.

A financial advisor can provide considerable value to Country Life Acres, MO small business owners who want to experience the benefits of a 401(k) plan. By working with a financial advisor, small business owners can provide a valuable benefit to their employees while also managing risk and ensuring the plan’s long-term success.

401(k) For Small Business Country Life Acres, MO | Retirement Planners | 401(k) Services Near Country Life Acres

Call Correct Capital to Start a 401(k) For Your Small Business in Country Life Acres, MO

If you own a small business in Country Life Acres, MO, you want to spend your time on why you started your business – not being bogged down by administrative tasks you may not have the time, knowledge, or interest to manage. As a Registered Investment Advisor with CERTIFIED FINANCIAL PLANNER® professionals, Correct Capital can both help position your and your employees' money for growth while giving you peace of mind that your small business's 401(k) plan is being operated efficiently and correctly. To start setting up a 401(k) for your small Country Life Acres, MO business today, call Correct Capital at 877-930-4015 or contact us online.


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