How to Launch Your Company's 401(k) Plan
Published April 2008
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COMMENT ON THIS ARTICLEThere's no doubt that a strong retirement benefit is a powerful tool for luring and retaining talented and dedicated employees. In fact, it confers a significant edge on small outfits, since only 15 percent of companies with five to 99 employees offer "defined contribution plans," as the IRS calls 401(k)s and IRAs.
Of course, given the costs associated with administering such a benefit and the matching contributions to your employees' accounts, it's also a fairly expensive way to keep your people happy. Yes, the government helps defray a significant portion of those expenses. All participants, company owners included, defer taxes on the wages they direct into a defined contribution plan. And your company can deduct its matching contributions and plan expenses. Still, it's well worth your time to be sure that any retirement plan you set up makes the most of your investment.
The pages that follow will help. They contain a step-by-step guide to picking a plan, a primer on the fees you can expect to pay, questions to ask a prospective investment adviser, and resources for further inquiry. Please read on.
Related Content
Resources
- For information from 401(k) basics to small-biz-specific issues, check out 401khelpcenter.com or benefitslink.com.
- For a searchable database of financial advisers accredited by the Center for Fiduciary Studies, go to fi360.com.
- The National Association of Personal Financial Advisors certifies fee-only financial professionals. Search for members at napfa.org.
- Financial Service Standards certifies advisers with the Professional Plan Consultant designation. Search for PPCs at 401kservicesolution.com.
