Many of our clients have their own businesses. As a business, we at Stonepath Wealth Management personally understand the risks and rewards involved with self-employment and entrepreneurship, and the importance of making smart investments for the business and for employees. Retirement plans for employees are vital because the better you treat your employees, the more vested they will be in working to grow the business. Thus, we are passionate about setting up the right plan to suit the individual needs of our business clients.
There are many business retirement strategies, some we work the most with are: A Simplified Employee Pension Plan (SEP), a Savings Incentive Match Plan for Employees (SIMPLE), a Safe Harbor 401(k) Plan, and an Owner K 401(k) Plan.
A SIMPLE IRA Plan is, as the acronym suggests, relatively simple. Unlike the SEP Plan, in the SIMPLE Plan both employers and employees make contributions to a traditional IRA. This is ideal for employees who would like to stash away more cash than normal. Because of its ease and convenience, it is also a good choice for small business employers starting retirement plans for the first time.
Safe Harbor 401(K)
A Safe Harbor 401(k) Plan is a specific 401(k) plan that allows employees to be actively involved in their retirement investments. Oftentimes, small business owners do not set up 401(k) plans for their employees because the non-discrimination clauses can be very difficult to follow. However, in 1996 The Small Business Job Protection Act was passed, creating the Safe Harbor 401(k) plan and simplifying the ways to meet the non-discrimination criteria for small-business owners.
With a SEP plan, a business owner can make contributions to traditional IRAs set up for employees. A SEP is suitable for businesses of any size, but is most common among the self-employed and smallest businesses.
Owner K 401(K)
Finally, the Owner K 401(k) is designed for small businesses with no employees except for the owner and the owner`s spouse. The Owner K allows business owners to invest cash that is tax-deductible, and to realize earnings that are tax-deferred.
Business retirement plans can be complex, and there are many more options available. Our team members are well versed in a variety of plans for your business – large or small.
Get In Touch
We are here to help you with all your financial planning needs. Send us a message and we will connect with you shortly.
Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a Broker/Dealer, member FINRA/ SIPC. Advisory services offered through Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Stonepath Wealth Management are not affiliated. Information relating to securities is intended for use by individuals residing in Alaska, Arizona, California, Colorado, Connecticut, District of Columbia, Florida, Georgia, Illinois, Indiana, Kansas, Kentucky, Maryland, Michigan, Missouri, Nevada, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Washington, Wisconsin, and Wyoming only. This is not an offer to sell securities, which may be done only after proper delivery of a prospectus and client suitability is reviewed and determined. Diversification and asset allocation strategies do not assure a profit or protect against loss. Past performance is no guarantee of future results. Investing involves risk. Depending on the types of investments, there may be varying degrees of risk. Investors should be prepared to bear the loss, including loss of principal. Cambridge does not offer tax advice. Check the background of this investment professional on FINRA’s BrokerCheck.