A SIMPLE Solution to Help Business Owners Invest For Their Future


If you are like many small business owners, you are concerned about saving enough for retirement. You may have had to use your business profits or money set aside for retirement to investment into your business. Your business, then, has become your retirement plan. As a result, 40% of owners are not confident they will be able to retire before age 65.

These figures come from SCORE, a nonprofit organization with dedicated volunteer mentors that help small businesses start, grow and develop.

Smaller businesses are less likely to offer retirement plans for employees than larger ones. Only 28% of those companies with 10 or less employees include a savings plan in their benefits package.

The number one reason most companies shy away from adding a plan is they think it is too expensive. Next, they don’t know who to turn to for help.

Low-Cost Retirement Plans Are Available and Easy

There are affordable and easy to administer options. For example, what if business owners could add a retirement savings plan that:

  • A way to contribute to your own retirement easily and regularly, and help your employees contribute to theirs
  • A low-cost plan funded mainly by employees
  • Employees can contribute up to 100% of compensation or a maximum of $14,000 ($17,000 if age 50 or over).
  • Business expense deductions for employee contributions
  • Easy administration with no tax filing
  • Employees get employer-matched contributions of up to 3% of annual compensation
  • Tax-deferred earnings
  • Pre-tax contributions for participants

Enter the SIMPLE IRA. A Savings Investment Match Plan for Employees (SIMPLE IRA) is an affordable program that allows self-employed individuals and small businesses with 100 or fewer employees to save for retirement. Eligible employees can fund their own SIMPLE IRA accounts through regular salary deferrals and Employers make additional contributions.

Another option is the Simplified Employee Pension Plan. The SEP IRA plan is best for owner-only businesses or those with just a few employees. You can make sizable contributions for yourself and any eligible employees. There’s little administration, and tax filing isn’t required. And you can vary contributions from year to year—or even skip a year. With this option:

  • High contributions for you: up to 25% of compensation (20% if you’re self-employed) or $61,000 for 2022, whichever is less.
  • Tax-deductible contributions that vest immediately
  • Tax-deferred earnings
  • Flexible annual contributions
  • A way to contribute to qualified employees’ accounts

These are two low-cost, easy-to-administer plans that can help any business owner save for their retirement. In addition, a retirement savings plan is attractive to employees and supports employee recruitment and retention.

Expert Advise is Just a Phone Call Away

2022 is a great year to get started with a retirement plan built just right for your business. Give us a call today, or use our easy calendar link to schedule a time to visit. You will get expert advice and the assistance you need to build your business and be on your way to a more secure financial future.

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