Retirement plan consultants in Sacramento, CA. Creating a retirement plan such as 401(k) is a strategic move for Sacramento, CA businesses and business owners looking for a competitive advantage. These plans are a vital component in retaining and attracting top talent, providing employees with a feeling of stability, and fostering a productive workforce. But, for businesses that have not established 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 challenging.
Correct Capital Wealth Management is an independent Sacramento, CA financial consultancy firm that specializes in helping companies set up and maintain 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 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 Sacramento, CA to help set up a 401(k) or other plan, give us a call at 877-930-4015, contact us online, or schedule an appointment with one of our financial advisors today.
Benefits of Starting a Retirement Plan for Your Sacramento, CA Business
To understand what a 401(k) or other retirement plan could do for your Sacramento, CA company, it's important to look at how much it means to your employees:
- 2 in 3 U.S. retirees say there's a retirement crisis in the country; four out of ten think they might live longer than their savings last (Source)
- Nearly 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 a recent study, nearly two-thirds of respondents said their main source of income in retirement will be their 401(k) (Source)
- 60% of employees cited their employers' retirement plan as a reason they remain; nearly half said it's an key reason to join a company; about four in ten ranked it in their top three most desired benefits (Source)
- More than three-quarters of employees with access to a plan participate (Source)
- 78% of younger workers that are 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 decisions with their money with the help of a financial advisor (Source)
Saving for our golden years is a significant concern for most Americans, and Sacramento, CA businesses that offer retirement plans give themselves a leg up when it comes to securing and keeping valuable employees. Moreover, there are a host of benefits for both employers and employees that retirement plans offer:
Business Benefits
- Tax deductions for matching contributions
- Earnings on plan assets are tax-free
- Variety of plan options and flexibility to adapt a plan to your business
- Tax credits , among other advantages from the SECURE ACT 2.0, assist in reducing start up costs
- Higher employee retention lowers the annual cost of training new employees
Employee Benefits
- Employee contributions can reduce their taxable income
- Contributions and earnings are not taxed until withdrawal
- Easy-to-make contributions through payroll deductions
- Small, regular contributions can grow into significant retirement savings
- Participant assets can be rolled over if they change employers
- Enhanced financial wellbeing in retirement
Retirement Plan Options Available for Sacramento, CA Businesses
If you're looking into sponsoring a 401(k) or other plan for your Sacramento, CA business, there are a multitude of plan options our retirement plan consultants can discuss with you:
- 401(k) Plans — The foundation of American retirement plans, 401(k)s allow for a wide range of investments across stocks, bonds, mutual funds, and ETFs, and allow employees to save and invest a part of their earnings before taxes are taken out. Employers can choose 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 — Similar to 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 specific amount or percentage of their paycheck, defined benefit plans offer a specific monthly withdrawal in 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 annual interest rate. This plan offers predictable benefits like a traditional pension but with individual accounts similar to a defined contribution plan. It's an attractive option for businesses looking for a middle ground between the security of pension plans and the adaptability of contribution plans.
- Simplified Employee Pension (SEP) IRAs — SEP plans offer a straightforward way for small businesses to sponsor retirement plans. Employers make contributions directly to an IRA established for each employee. SEPs are easy to administer, with minimal red tape, and contributions are deductible for the business. They're especially well-suited for businesses with fluctuating income, as the contribution amounts can be modified 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 salary to the plan, which employers must match up to a certain percentage. SIMPLE IRAs are a great choice for small businesses looking to offer 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 often made out of the company's profits, 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 give 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, potentially boosting 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 Sacramento, CA retirement plan consultants currently manage over 30 plans in both small and large companies, and oversee over $230 million in total plan assets across the U.S. Our experience and expertise allows us to offer a range of services that encompass both the initial set up and ongoing support:
- Plan selection — We'll assist in evaluating and selecting the most fitting retirement plan for your business, considering factors such as company size, financial goals, employee demographics, and tax advantages. 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 — Several steps are required to make the retirement plan legitimate. These include adopting a written plan, arranging a trust for trust assets, notifying eligible employees about terms and conditions, and establishing a record-keeping system. Our Sacramento, CA retirement plan consultants can manage and/or assist with each of these steps.
- Plan changes — Possibly you're unsatisfied your current plan, or your business has evolved and you need a retirement plan consultant that can help your retirement plan adapt as you grow. Consultants can assist you in modifying your plan to adapt to business growth, changes in workforce, or shifts in financial goals. This includes adding new features, modifying 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 wide array of analytical tools, resources, and experience to help with the selection of investment options that ought to be made available within the plan. This includes analyzing the performance of different investment funds, determining their risk levels, and guaranteeing a diverse range of options to accommodate the varying investment preferences and retirement goals of your employees.
- Plan documentation — Retirement plan consultants help in drafting and maintaining all required 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 — Informing participants is key to ensuring that your employees comprehend the benefits of participating in the retirement plan and how to make informed investment choices. Correct Capital's retirement plan consultants engage in quarterly webinars to plan participants and offer personalized coaching for topics such as retirement planning, investment risk, and how to maximize their retirement savings.
- Help with regulations and audits — The IRS, SEC, ERISA, and other laws and institutions establish 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 Sacramento, CA business stays compliant. Moreover, hiring Correct Capital as your retirement plan consultant enables us to assume much of the fiduciary duty related to the plan off your shoulders.
Other services we offer in Sacramento, CA include:
Sacramento, CA Retirement Plan Consultants | Correct Capital
As you consider the future prospects of your company and the welfare of your employees, offering a retirement plan should be at the forefront. With our wide array of offerings and commitment to acting solely in your best interest, we'll help you lead your Sacramento, CA company and staff from where you are to where you want to go. To start crafting a plan that fits with your unique company and objectives, talk to a retirement plan consultant in Sacramento, CA today at 877-930-4015 or contact us online.
