Start Saving for Retirement Today with a Starter(k) Plan

Individuals can save up to $6,500 every year (updated annually by the IRS)
Save an additional $1,500 every year if you’re age 50 or older
Retirement savings are protected from bankruptcy and creditors
Easy & low cost administration

Start Saving for Retirement Today

Secure 2.0 tax credits will help cover your setup and admin fees

What is a Starter(k) Plan?

This is a new type of basic, low-contribution limit 401(k) plan to help small business owners who haven’t started saving for retirement. This plan is perfect for those who:

Can save up to $6,500 a year for retirement
Want a basic, simple way to start to save for retirement
Wish to avoid compliance testing
Want government tax credits to cover setup and administrative costs
Can’t afford to contribute to employees’ retirements

Sign up for a Starter(k) plan today

How does a Starter(k) Plan Work?

Based on the rules from the recently passed Secure 2.0 legislation, here’s how a Starter(k) plan would work:

Auto-enrollment of employees is required at 3%
Once you sign up, money is deferred from your and your employees’ paychecks automatically each pay period
Retirement savings could grow tax-deferred or tax-free, depending on which you choose:
- Pay taxes later when you take the money out for retirement (i.e. tax-deferred). You’ll receive tax benefits today because your contributions reduce your taxable income now instead of later down the road
- Pay taxes now on your contributions but avoid paying taxes later when you take the money out for retirement after you turn 59.5 years old – when presumably your money has grown to a much larger amount than it is today
Like most other retirement accounts, distributions taken after age 59.5 will not incur a penalty; if money is withdrawn earlier, a 10% penalty will apply and you may potentially pay income tax on the amount withdrawn

Sign up for a Starter(k) plan today

Benefits of a Starter(k) vs. State-Sponsored Retirement Plans for Small Business

Benefits

Starter(k)

State Sponsored Retirement Plans for Small Business

Winner

Setup and administrative fees covered by the government for 3 years

Yes

With Secure 2.0, tax credits are provided when you file your taxes to offset your setup and administrative fees

No

You pay 100% of the setup and administrative fees on your plan

Starte(k)

Flat Fees

Yes

Ubiquity is the only Starter 401(k) provider charging only flat fees and not asset based % fees. This means no matter how big your money grows, you’ll pay the same low fee as you did in the beginning. You’ll end up with a lot more $$$ after 30 years with this arrangement.

No

Currently, all state sponsored retirement plans charge asset based % fees. This means the larger your account balance grows, the more money you pay. After 30 years you’ll end up with less money than if you went with a flat-fee provider.

Starter(k)

Protected from bankruptcy

Yes

All assets in a Starter(k) plan are protected from seizure if you ever have to declare bankruptcy

No

Not protected in bankruptcy after $1 million in IRA assets

Starter(k)

Protected from lawsuits

Yes

All assets in a Starter(k) plan are protected from seizure if you ever have a legal judgement against you

No

Not protected from lawsuits after $1 million in IRA assets

Starter(k)

Pre-tax and post-tax contribution options

Yes

You can choose tax-deferred or tax-free retirement contributions

No

Only tax-free ROTH IRA option is available

Starter(k)

Sign Up for Your Starter(k) Today

Get Started Saving for Your Retirement with a Starter(k)

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