Retirement plan consultants in Elk Grove, CA. Establishing a retirement plan like a 401(k) is a smart step for Elk Grove, CA companies and business owners looking for a way to stand out. Retirement plans are a vital component in retaining and attracting top talent, providing employees with a feeling of stability, and fostering a committed workforce. But, for businesses that have not established a retirement plan before, or for companies looking for a plan upgrade, the variety of plans available, legal requirements, and tax considerations can be overwhelming.
Correct Capital Wealth Management is an independent Elk Grove, CA financial advisory firm that specializes in assisting companies establish and manage customized retirement plans, built around the needs of both your business and workers. We enjoy exploring the unique story behind each business we work with and getting to know the entrepreneurial spirit that guides their leaders. As fiduciary advisors, we have a legal and ethical obligation to act only in your best interest. If you're in search of a retirement plan consultant in Elk Grove, CA to help set up a 401(k) or other plan, give us a call at 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 Elk Grove, CA Business
To understand what a 401(k) or other retirement plan could mean for your Elk Grove, CA business, it's crucial to examine how much it means to your employees:
- 2 in 3 U.S. retirees say the country is in a retirement crisis; 40% think they might outlive their retirement savings (Source)
- Almost half of retirees say their income wasn't high enough to save for retirement; 55% blame their employer for not doing enough to help them save (Source)
- In a recent study, nearly two-thirds 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; nearly half said it's an important reason to join a company; 44% ranked it in their three top most desired benefits (Source)
- Nearly four out of five employees with access to a plan choose to participate (Source)
- Nearly eight in ten of Millennial and Gen Z 401(k) plan participants are looking for personalized investment advice for their plan (Source)
- 77% of plan participants are "extremely confident" in their ability to make sound financial decisions with the help of a financial advisor (Source)
Retirement savings is a huge concern for most Americans, and Elk Grove, CA businesses that sponsor retirement plans give themselves a leg up when it comes to attracting and retaining talent. Additionally, there are a bevy of benefits for both employers and employees that retirement plans offer:
Business Benefits
- Tax deductions for matching contributions
- Tax-free earnings on assets
- 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
- Contributions and earnings are not taxed until withdrawal
- Easy-to-make contributions through payroll deductions
- Even small, regular contributions can accumulate into significant retirement savings
- Participant assets can be rolled over if they change employers
- Enhanced financial wellbeing in retirement
Types of Retirement Plans Available for Elk Grove, CA Businesses
If you're looking into setting up a retirement plan for your Elk Grove, CA business, there are a variety of plan options our retirement plan consultants are ready to discuss:
- 401(k) Plans — The cornerstone of American retirement plans, 401(k)s allow for a wide range of investments across stocks, bonds, mutual funds, and ETFs, and permit employees to save and invest a portion of their paycheck before taxes are deducted. Employers have the option to match contributions. Safe Harbor 401(k) plans are largely the same, but employer contributions are required to 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 educational institutions and non-profits.
- Defined Benefit (Pension) Plans — While 401(k)s and other defined contribution plans are based on employees contributing a specific amount or percentage of their earnings, defined benefit plans offer a guaranteed monthly withdrawal once an employee reaches retirement. These plans are largely employer-funded, and the company takes on the investment risk.
- Cash Balance Plans — Cash balance plans are a type of defined benefit plan that accounts for each participant's balance in a hypothetical account, which increases 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 attractive option for businesses seeking a middle ground between the certainty of pensions and the adaptability of contribution plans.
- Simplified Employee Pension (SEP) IRAs — SEP plans offer a straightforward way for small businesses to provide retirement benefits. Employers make contributions directly to an IRA set up for each employee. SEPs are straightforward to manage, with minimal red tape, and contributions are tax-deductible for the business. They're particularly well-suited for businesses with variable profits, as the contribution amounts can be adjusted annually.
- Savings Incentive Match Plan for Employees (SIMPLE) IRA — SIMPLE IRAs are tailored to small businesses with 100 or fewer employees. These plans are simpler to manage than 401(k)s but allow employees to contribute a part of their earnings to the plan, which employers are required to match up to a certain percentage. SIMPLE IRAs are an excellent option for small businesses looking to offer a more traditional retirement plan without the complexities of larger plans.
- Profit-Sharing Plans — Profit-sharing plans are flexible retirement solutions that enable employers to make discretionary contributions to their employees' retirement funds. Contributions are often made from company stock, giving employees a direct stake in the company's bottom line. These plans can be structured in many ways, offering flexibility in how contributions are distributed and calculated among employees.
- Employee Stock Ownership Plans (ESOPs) — ESOPs provide employees with company stock, offering them 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, which can boost productivity and job satisfaction. ESOPs can also complement a company's succession planning as ownership shares can be passed to top employees who will eventually lead of the business.
How Can Correct Capital Help My Business's Retirement Plan?
Our Elk Grove, CA retirement plan consultants currently manage over 30 plans in companies of all sizes, and oversee over $230 million in total plan assets across the country. Our expertise and experience allows us to offer a range of services that include both the initial set up and ongoing support:
- Plan selection — We'll help with evaluating different plan options and selecting the most appropriate retirement plan for your business, considering factors such as company size, financial goals, employee demographics, and tax advantages. The goal is to choose a plan that offers the best benefits to your employees while also helping out your bottom line.
- Establishing the plan — A number of steps are required to formally put the retirement plan in place. These include adopting a written plan, arranging a trust for trust assets, notifying eligible employees about the terms of the plan, and creating a record-keeping system. Our Elk Grove, CA retirement plan consultants can carry out and/or assist with all of these requirements.
- Plan changes — Maybe you're unsatisfied 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 help you with modifying your plan to accommodate business growth, changes in workforce, or shifts in financial goals. This includes adding new features, adjusting contribution limits, or transitioning to a different type of plan to better meet your needs.
- Investment advice — As a Registered Investment Advisor (RIA), we have access to a diverse range of analytical tools, resources, and experience to assist with the selection of investment options that should be made available within the plan. This includes assessing the performance of different investment funds, evaluating your employees' risk tolerance, and guaranteeing a diverse range of options to meet the varying investment preferences and retirement goals of your employees.
- Plan documentation — Retirement plan consultants help in drafting and maintaining all essential plan documentation, ensuring compliance with IRS and Department of Labor regulations. This includes adoption agreements for the plan, summary plan descriptions, and annual notices to participants.
- Ongoing participant education — Education is paramount to ensuring that your employees understand the benefits of participating in the retirement plan and how to make informed investment choices. Correct Capital's retirement plan consultants carry out 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 set rigid guidelines for how companies need to stay legally compliant with their retirement plans. Most 401(k) plans are also subject to annual audits. Retirement plan consultants can assist in ensuring your Elk Grove, CA business stays compliant. Moreover, hiring Correct Capital as your retirement plan consultant helps remove much of the fiduciary duty related to the plan off your shoulders.
Other services we offer in Elk Grove, CA include:
Elk Grove, CA Retirement Plan Consultants | Correct Capital
As you think about the future prospects of your company and the well-being of your workforce, providing a retirement plan should be at the forefront. With our comprehensive suite of offerings and dedication to working solely in your best interest, we'll help you lead your Elk Grove, CA company and staff from where you are to where you want to go. To start developing a plan that aligns with your distinct business and goals, reach out to a retirement plan consultant in Elk Grove, CA today at 877-930-4015 or contact us online.
