Business News Daily: 401(k) Plan: What It Is and How to Choose One

Author: Siân Killingsworth / 5 May 2019

Unless you work in the retirement industry, you could probably brush up on your 401(k) basics. That’s where the experts at Ubiquity Retirement + Savings come in. In honor of #NationalSmallBusinessWeek Ubiquity senior vice president Andrew Meadows gave a quick lesson in Small Business Retirement 101.

“While MEPs (multiple employer plans) and state mandates are all the talk on an industry level, the 401(k) is still the best tried-and-true way to save at work. With high contribution limits and the ability to lower costs, the 401(k) is becoming leaner and a more popular option for small businesses.”

Learn exactly what a 401(k) is and how different kinds of plans work, along with how to find a retirement savings plan that meets the needs of your specific business and employees. You may think your business is too small for a 401(k) plan, but these plans aren’t only for big companies.

Meadows noted that this is a common misconception, saying small business owners have a few main reasons for being hesitant about implementing a 401(k):

• Having a 401(k) plan would affect the success of the business if they already don’t have enough money to run the business.
• The plans are complicated and usually involve a lot of jargon.
• It is expensive. There are fees involved, such as managing fees and investment fees, that aren’t usually presented at first.

Meadows said that small businesses should want to provide the most robust 401(k) plan that the business can afford.

“Today, there are more and more providers helping small businesses avoid high-cost funds and access manageable monthly administration fees,” he continued. “This may vary from business to business, but the sooner you can set up a 401(k) plan, the better.”