In the past, many small business owners have thought that providing a 401(k) plan wasn’t realistic for their employees. Perhaps they felt they were too small, that the plans were too expensive, or that the administrative burden was just too high.
Luckily, this is no longer the case, and not only is it possible—and affordable—for companies of any size to start providing a savings plan, but getting an early start is also advantageous from a tax-saving perspective.
- A recent Glassdoor employment confidence survey found that 31% of workers value a 401(k), retirement plan, and/or pension over more than a pay raise.
- Approximately two-thirds of workers not saving for retirement say they would be likely to save for retirement if their employer used automatic paycheck deductions at either 3% or 6% of salary.
- In 2018, workers can make tax-deductible contributions of up to $18,500 to a 401(k).
The other good news is that in this tight job market, offering a workplace retirement plan is a great way to make your business stand out from the competition. However, it’s not just employees who can draw huge benefits: as it turns out, employers can also reap some incredible tax credits and deductions for providing a 401(k).