Small Business Retirement Plans in Town and Country, MO. Offering a retirement plan to your Town and Country, MO employees is a great way to retain talent, incentivize higher performance, and get those much-needed tax breaks. However, for most business owners, it can be hard to know where to start. What type of plan is best for your business? What are the different laws that apply to different plans? What do I do when I want to change plans, or if I'm retiring and my business will no longer be running? Correct Capital's team of Town and Country, MO financial planners has over 70 years of combined experience helping business owners and their employees reap the benefits of having a sound retirement plans and navigate the complexity of federal regulations. For anything from initial setup and employee education to fine-tuning an existing plan, call Correct Capital today at 314-930-401K or contact us online.
What Types of Retirement Plans Are Available to Small Businesses in Town and Country, 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 — This type of individual retirement account is available to self-employed business owners with no employees, freelancers, and businesses with very few employees. It functions similarly to 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 are required to contribute an equal percentage of compensation to employees as to their own, however the contributions are tax-deductible.
- SIMPLE IRA — "SIMPLE" is an acronym for "Savings Investment Match Plan for Employees," and these IRAs are commonly seen as "start-up" retirement savings plans for smaller businesses that do not yet offer a plan. Employers can contribute 2% of an employee's paycheck, or dollar-to-dollar match an employee's contribution up to 3%.. 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 employers with no more than 5 employees. With this plan, an employee targets how much they would like to have in retirement, and contribution limits are adjusted annually based on their desired income, age, salary, and tenure with the company. While this plan is highly customizable and allows for significant contributions, you will be subject to annual fees.
- Business 401(k) Plan — 401(k)s are a workplace savings plan that offers employees tax breaks for contributions and investment opportunities. There are annual contribution limits. Most 401(k) plans offer considerable tax planning benefits for both companies and employees. They can include:
- Individual 401(k) — Also known as a One-Participant 401(k), this plan is aimed at offering similar benefits to a business 401(k), but for people who are self-employed, or whose 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 can choose 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 "best" for you will depend on the nature of your business and your employees' needs. Different retirement have different tax benefits, expenses, required minimum distributions, limits on how much you can put in each year, and more. A reputed financial advisor like those at Correct Capital will be able to help you determine which plan works best for you and your team.
Why You Should Set Up a Small Business Retirement Plan in Town and Country, MO
The specific, financial-based benefits for your Town and Country, MO small business retirement plan is dependent upon which plan you choose. However, a small business retirement plan, whichever one you choose, has universal benefits. 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:
- More confidence in their retirement planning
- Tax deductions
- Contributions can be easily made through salary deferral
- Contributions and investment gains are not taxed until they take them out
- Over the years small contributions grow into considerable sums of money
- Ability to conduct a 401(k) rollover if it's beneficial down the road
- Attract, recruit, and retain high performers
- Promote great work ethic
- Employer contributions are tax-deductible
- Flexible plan options to fit your plan to your needs
- Tax credits that can help reduce startup costs
Do I Need a Financial Advisor in Town and Country, MO to Assist With My Small Business Retirement Plan?
Setting up small business retirement plans is far different from setting up a personal account at your local Town and Country, MO bank. While the federal government does not currently require any employer to offer a retirement plan to employees, some states require businesses with a minimum number of employees to offer access to a retirement plan. Town and Country, MO retirement consultants that are experienced in helping business owners open retirement plans are usually needed to not only ensure you and your employees get the most out of your plan, but that you follow frequently chancing tax and business laws.
As your Town and Country, MO retirement plan consultants for your small business, our financial planners will:
- Help you decide the best plan for you, and which financial institution should hold the assets
- Assist you in establishing your plan, including adopting a written plan, establishing a trust for plan assets, helping employees understand how specific of the plan apply to their savings, and creating a record keeping system
- Help you operate your plan by keeping up-to-date 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 continued financial health
Correct Capital's Town and Country, MO advisors hold ourselves to the fiduciary standard, meaning we are obligated, by law and by ethics to only offer advice based on what we believe is in your best interest. We work for you, and not our own firm. Schedule a meeting with a member of our advisor team today.
Other services we offer in Town and Country, MO include:
- 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
- Retirement Planning
Small Business Retirement Plans in Town and Country, MO | Correct Capital
Operating a small business involves a mountain of daily, monthly, and annual tasks to ensure things run smoothly — navigating the complexities of a small business retirement plan doesn't have to 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, call Correct Capital today at 314-930-401K or contact us online.
*as of January 2022