Small Business Retirement Plans in Concord, MO. Offering a retirement plan to your Concord, MO employees is a great way to retain talent, incentivize higher performance, and get those much-needed tax reductions. However, many business owners understandably have questions about small business retirement plans. What benefits do different kinds of plans provide? What federal regulations do I have to follow? What happens when I want to change plans, or if I'm closing my business? Correct Capital's team of Concord, MO financial planners is committed to helping business owners and their employees get the most out of their retirement plans and navigate the specifics of federal regulations. Whether you're interested in modifying an existing plan or are looking to create an entirely new one, call Correct Capital today at 314-930-401K or contact us online.
What Types of Retirement Plans Are Available to Small Businesses in Concord, MO?
Types of retirement plans vary; some only apply to businesses of a certain size, while some differ other areas such as employer contributions. Among the most common small business retirement plans are:
- SEP-IRA — A "Simplified Employee Pension" is a type of individual retirement account that is available to self-employed business owners with no employees, freelancers, and businesses with very few employees. It follows the same rules as a traditional IRA, where the money put into the account grows tax-deferred. Contributions are limited to the lessor of 25% of an employee's compensation or $66,000 (as of 2023). Employers can deduct contributions they make on behalf of their employees.
- SIMPLE IRA — "SIMPLE" stands for "Savings Investment Match Plan for Employees," and these plans are for businesses with up to 100 employees. Contributions are made through salary deferrals and employer contributions. This is relatively inexpensive for employers as it's mainly funded by employees, and employer contributions can be deducted as a business expense.
- Personal Defined Benefit Plan — This plan is only available to owner-only businesses, or businesses with no more than 5 employees. With this plan, you target a desired level of retirement income, and contribution limits are modified each year based on their desired income, age, salary, and tenure with the company. While this plan allows for high contributions and a plan tailored to each individual, you will have to pay costs and fees.
- Business 401(k) Plan — 401(k)s can be set up by private companies of any size, and are highly customizable. There are annual contribution limits. Most 401(k) plans come with significant tax planning benefits for both companies and workers. They can include:
- Individual 401(k) — Also called an Owner-Only 401(k), this plan is aimed at offering similar benefits to a business 401(k), but only for owner-only businesses, or businesses where the only employee is a spouse. You can contribute up to the annual 401(k) limit each year, and the employer may make a nonelective contribution up to 25% of compensation or, if self-employed, an amount considering your earned income and deducting half of self-employment tax paid and contributions made by you over the course of the year. You may also decide to open a Roth 401(k) account, or roll over pre-tax assets.
There are pros and cons to each plan, and which may be better suited to you will be based on your business and your and your employees' needs. Different retirement have varying tax benefits, costs, required minimum distributions, maximum contributions, and more. A reputed financial advisor like those at Correct Capital will review your options and guide you in choosing the best retirement plan for your small business.
Why You Should Set Up a Small Business Retirement Plan in Concord, MO
The specific, financial-based benefits for your Concord, MO small business retirement plan is dependent upon which plan you choose. That said, a small business retirement plan, whichever one you choose, benefit employers and employees in the same way. Over half of employees responded to a survey stating it is a "very important" factor in job satisfaction, while employers reap the benefits both during tax season and in office productivity. Companies and employees will both enjoy:
- Improved financial security in retirement
- Reduced taxable income
- Contributions are simple with payroll deductions
- They do not pay taxes on money they put in or how the money grew until they take them out
- Over the years small savings grow into significant sums of money
- Ability to conduct a 401(k) rollover if it's beneficial down the road
- Attract, recruit, and retain high performers
- Incentivize based on performance-based employer contributions
- Employer contributions are tax-deductible
- Flexible plan options to fit your plan to your needs
- Tax credits upon initial set-up
Do I Need a Financial Advisor in Concord, MO to Assist With My Small Business Retirement Plan?
Opening small business retirement plans is complicated. While the federal government does not currently obligate any company to offer a retirement plan to workers, certain states require employers with a minimum number of employees to offer access to a retirement plan. Concord, MO retirement consultants that are experienced in helping business owners set up retirement plans are usually needed to not only ensure you get the benefits you're looking for, but that you abide by ever-changing tax and business laws.
As your Concord, MO retirement plan consultants for your small business, our team will:
- Help you choose which plan works best for you and your employees, and the right custodian to hold plan assets
- Assist you in setting up your plan, including creating a document that complies with IRS code, establishing a trust for plan assets, helping employees understand the plan's terms, and implementing a record keeping system
- Help you operate your plan by staying compliant with relevant laws, managing the plan's assets, and distributing benefits
- Help educate your employees on your plan, its benefits, and how it can serve as a part of their ongoing financial health
Correct Capital's Concord, MO financial planners are fiduciary advisors, meaning we are legally and ethically obligated to do what's best for you and your employees. As an independent firm, we have the freedom and flexibility to tailor our offerings to best suit the goals of our clients. Schedule a consultation with a member of our advisor team today.
Other services we offer in Concord, MO include:
- Succession Planning
- Fiduciary Financial Advisor
- Company 401(k) Plans
- ESOP Advisor
- Self-Employed Retirement Plans
- 401(k) For Small Business
- Tax Planning
- Social Security Consultants Near Me
- Retirement Calculator
Small Business Retirement Plans in Concord, MO | Correct Capital
Operating a small business comes with a plethora of moving parts and tasks to ensure things run smoothly — navigating the complexities of a small business retirement plan shouldn't be one of them. Correct Capital currently manages over 30 plans in both small and large companies, and represents over $230 million in total plan assets* throughout the country. To set up a retirement plan for your small business, or learn what other services we offer to business owners, speak to a financial advisor at Correct Capital today at 314-930-401K or contact us online.
*as of January 2022