Rank and employees seem to be thinking about retiring earlier these days than ever before . Part of our responsibility as the employer is to assure them that they will have adequate financial resources to turn to when this time comes because we are helping them save towards this goal . This is why there are several types of retirement investment funds available in the market today . These various retirement plans require the active participation of the employer as a co-contributor to these plans . Existing laws allow businesses to offer multiple [banner_entry_middle]
retirement plans . This proposal is meant to analyze and compare 2 of these plans . These plans are the 401 (k ) and SEP IRA plans
The 401 (k ) plan , is the most popular deferred compensation plan . It is paid for by a portion of the employee salary and does not require employer contribution . Although some employers match the employee contribution in to encourage employee participation in this plan The plans in to implement the 401 (k ) can be quite expensive and complicated at times . Other disadvantages of this plan is that it cannot be used by the holder until the age of 59 and it is not insured by the Pension Benefit Guaranty Corporation . On the other hand , a Simplified Employee Pension (SEP ) IRA is a basic plan that allows the employers to contribute to his employees retirement without the intricacies of other retirement plans like the 401 (k . Consider it a small business low-cost pension plan . This plan has a huge disadvantage for the employers though . Under this plan , once an employee leaves a company , he gets to bring all his retirement contributions because the money contributed by the employer automatically belongs to the employee . This gives the employee the right to take the contributions with him
All things considered , you as the employer have the final say in the retirement plan for your employees . We are simply here to advice you on making the right choice for your company and benefits . If you will consider the calculated comparison chart we have provided below as a decision making guide
Lott , Christopher . 2007 . The Investment FAQ . Retrieved January 29 , 2007 from http /invest-faq .com… [banner_entry_footer]
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