Retirement plan consultants in Birmingham, AL. Establishing a retirement plan like a 401(k) is a smart move for Birmingham, AL businesses and business owners looking for a competitive advantage. Retirement plans are a key factor in retaining and attracting top talent, providing employees with a sense of security, and fostering a productive workforce. But, for businesses that have not set up a retirement plan before, or for companies who'd like to make changes to their current plan, the wealth of plan options, regulatory compliance, and tax considerations can be daunting.
Correct Capital Wealth Management is an independent Birmingham, AL financial advisory firm that specializes in assisting companies establish and manage unique retirement plans for your unique business and workforce. We enjoy exploring the unique story behind every company we work with and getting to know the entrepreneurial spirit that motivates their leaders. As fiduciary advisors, our sole aim is to act in your best interest. If you're looking for a retirement plan consultant in Birmingham, AL to help create a 401(k) or other plan, reach out to us via 877-930-4015, contact us online, or make an appointment with a member of our advisor team today.
Benefits of Starting a Retirement Plan for Your Birmingham, AL Business
To understand what a 401(k) or other retirement plan could mean for your Birmingham, AL business, it's crucial to examine what a retirement plan means for your employees:
- 67% of U.S. retirees say the country is in a retirement crisis; 40% worry they will live longer than their savings last (Source)
- Almost half of retirees say their income wasn't sufficient to save for retirement; over half blame their employer for not doing enough to help them save (Source)
- In one survey, 62% of respondents said their largest source of income in retirement will be their 401(k) (Source)
- Six out of ten of employees cited their employers' retirement plan as a reason they remain; 47% said it's an key reason to join a company; about four in ten ranked it in their three top most desired benefits (Source)
- Nearly four out of five employees with access to a plan participate (Source)
- 78% of Gen Z and Millennial 401(k) plan participants are keen on customized investment advice for their plan (Source)
- 77% of plan participants are "extremely confident" in their ability to make sound decisions with their finances with the help of a financial advisor (Source)
Retirement savings is a major concern for most Americans, and Birmingham, AL businesses that sponsor retirement plans give themselves a competitive advantage when it comes to securing and keeping valuable employees. Beyond that, there are a bevy of benefits for both employers and employees that retirement plans offer:
Business Benefits
- Tax deductions for employer contributions
- Earnings on plan assets are tax-free
- A range of plan choices and the flexibility to adapt a plan to your business
- Tax credits and other benefits from the SECURE ACT 2.0, can lower start up costs
- Higher retention rates lower the annual cost of turnover
Employee Benefits
- Employee contributions can reduce their taxable income
- No taxation on contributions and earnings until withdrawal
- Easy-to-make contributions through payroll deductions
- Even small, regular contributions can accumulate into significant retirement savings
- Assets can be rolled over by participants if they change employers
- Enhanced financial wellbeing in retirement
Types of Retirement Plans Available for Birmingham, AL Businesses
If you're considering sponsoring a retirement plan for your Birmingham, AL business, there are a range of plan options that may be right for your business:
- 401(k) Plans — The cornerstone of American retirement plans, 401(k)s enable for diverse investments including stocks, bonds, mutual funds, and ETFs, and allow employees to save and invest a part of their income before taxes are taken out. Employers have the option to match contributions. Safe Harbor 401(k) plans are essentially the same, but employer contributions must be fully vested when made. In exchange, safe harbor 401(k)s are not subject to annual nondiscrimination tests.
- 403(b) Plans — Much like 401(k)s, 403(b)s are specifically designed for employees of non-profit entities.
- Defined Benefit (Pension) Plans — While 401(k)s and other defined contribution plans are based on employees contributing a certain amount or percentage of their earnings, defined benefit plans promise a guaranteed monthly withdrawal in retirement. These plans are largely employer-funded, and the company bears the investment risk.
- Cash Balance Plans — Cash balance plans are one form of defined benefit plan that tracks each participant's balance in a hypothetical account, which grows annually through employer contributions and an interest credit rate. This plan offers consistent returns like a traditional pension but with personalized accounts similar to a 401(k). It's an appealing option for businesses seeking a middle ground between the security of pension plans and the adaptability of contribution plans.
- Simplified Employee Pension (SEP) IRAs — SEP plans offer an uncomplicated way for small businesses to provide retirement benefits. Employers make contributions directly to an IRA established for each employee. SEPs are easy to administer, with minimal paperwork, and contributions are deductible for the business. They're especially well-suited for businesses with variable profits, as the contribution amounts can be modified annually.
- Savings Incentive Match Plan for Employees (SIMPLE) IRA — SIMPLE IRAs are designed for small businesses with 100 or fewer employees. These plans are simpler to manage than 401(k)s but allow employees to contribute a percentage of their income to the plan, which employers must match up to a certain percentage. SIMPLE IRAs are an excellent option for small businesses seeking to provide a more traditional retirement plan without the red tape associated with larger plans.
- Profit-Sharing Plans — Profit-sharing plans are flexible retirement solutions that enable employers to make optional contributions to their employees' retirement funds. Contributions are typically made out of the company's profits, giving employees an incentive to contribute to the company's bottom line. These plans can be structured in many ways, offering flexibility in how contributions are calculated and distributed among employees.
- Employee Stock Ownership Plans (ESOPs) — ESOPs provide employees with company stock, providing an ownership interest in the business. ESOPs are not only a retirement benefit but also synchronize financial goals of employees with those of the company's performance, potentially boosting productivity and job satisfaction. ESOPs can also complement a company's succession planning as ownership shares can be passed to high performers who will eventually lead of the business.
How Can Correct Capital Help My Business's Retirement Plan?
Our Birmingham, AL retirement plan consultants currently manage over 30 plans in companies of all sizes, and oversee over $230 million in total plan assets across the U.S. Our expertise and experience enables us to offer a range of services that encompass both the initial set up and ongoing support:
- Plan selection — We'll help with evaluating and selecting the most appropriate retirement plan for your specific company, considering factors such as number of employees, financial goals, employee demographics, and tax considerations. The goal is to select a plan that offers the best benefits to your employees while being cost-effective for your business.
- Establishing the plan — A number of steps are required to make the retirement plan legal. These include adopting a written plan, arranging a trust for trust assets, notifying eligible employees about the terms of the plan, and setting up a record-keeping system. Our Birmingham, AL retirement plan consultants can handle and/or assist with each of these steps.
- Plan changes — Perhaps you dislike your current plan, or your business has evolved and you need a retirement plan consultant that can help your retirement plan evolve with you. Consultants can assist you in modifying your plan to adapt to business growth, changes in workforce, or shifts in financial goals. This includes introducing new options, adjusting contribution limits, or transitioning to a different type of plan to suit your needs.
- Investment advice — As a Registered Investment Advisor (RIA), we possess a diverse range of analytical tools, resources, and experience to aid in the selection of investment options that ought to be made available within the plan. This includes assessing the performance of different investment funds, evaluating their risk levels, and providing a diverse range of options to meet the varying investment preferences and retirement goals of your employees.
- Plan documentation — Retirement plan consultants assist in drafting and maintaining all necessary plan documentation, ensuring compliance with IRS and Department of Labor regulations. This includes plan adoption agreements, summary plan descriptions, and annual notices to participants.
- Ongoing participant education — Education is paramount to ensuring that your employees grasp the benefits of participating in the retirement plan and how to make wise investment choices. Correct Capital's retirement plan consultants conduct quarterly webinars to plan participants and offer one-on-one coaching for topics such as retirement planning, investment risk, and how to increase their retirement savings.
- Help with regulations and audits — The IRS, SEC, ERISA, and other laws and institutions establish rigid frameworks for how companies establish and maintain their retirement plans. Most retirement plans are also subject to annual audits. Retirement plan consultants can make sure your Birmingham, AL business stays compliant. Moreover, hiring Correct Capital as your retirement plan consultant allows us to take much of the fiduciary duty related to the plan off your shoulders.
Other services we offer in Birmingham, AL include:
- Financial Planning for Business Owners
- Comprehensive Financial Planning
- Retirement Income Planning
- Investment Planning
- Retirement Financial Planning
- Independent Financial Advisor
- Roth Conversion
- Investment Management
- 401(k) Audit
- High-Net-Worth Wealth Management
Birmingham, AL Retirement Plan Consultants | Correct Capital
As you think about the future of your company and the welfare of your workforce, providing a retirement plan should be a top priority. With our comprehensive suite of services and deep commitment to acting only in your optimal interest, we'll help you lead your Birmingham, AL business and staff from where you are to where you want to go. To initiate crafting a plan that fits with your unique company and objectives, speak to a retirement plan consultant in Birmingham, AL today at 877-930-4015 or contact us online.
