According to the American Institute of Certified Public Accountants, 80% of employees would keep a job with benefits rather than take one that offered more pay and no benefits. But, that almost comes as no surprise. There’s a reason why we call money “Cold Hard Cash” — benefits help us, as employees, know that we are appreciated and needed. Cash… not so much; that’s just a means to an end. Want a number to that? In some cases, employees consider benefits, like a 401(k), worth more than a 30% salary increase.
Congratulations! That little tidbit may have just saved you a boat-load of money on your next hire.
So, why do so few businesses offer benefits to their employees? Let’s take a look at 5 lies about 401(k) plans that might be hurting your business.
401(k) Plans Are Expensive
Yes. (Wait, I thought these were all lies.) Traditional 401(k) plans from large institutions, as well as some modern ones, have set-up fees because much of the process for getting started is done manually. Even if the process is an electronic sign-up, some companies just keep the fee structure because… well, we don’t know why.
As an example of reduced fees, SaveDay® eliminated all unnecessary fees. We believe investments should grow freely.
Employees Just Want Money
Well, they do want to get paid, but benefits are considered compensation. Most employees consider a good benefits package to be worth a 30% pay increase. Why? Because you’ve just reduced their overall living expenses with insurance and retirement planning. And, let’s not forget Millenials; they’re saving 400% more than the last decade.
Employees’ Tight Budgets
Saving means sacrificing, but investing offers an increase. Of course, there can be extenuating circumstances, this is a mindset that can be addressed. Investing no longer requires a lot of money, and can start with as little as a dollar per day. Just by simply offering a 401(k) to your employees, you are giving them the opportunity to explore their investing potential.
Matching Is Required
Sure! A matching 401(k) is considerate (and tax-deductible), but it is not required when setting up the plan. The first step is to start small; simply offer the plan, and see how well that goes. You can always add a matching contribution plan as you become more familiar with your 401(k).
401(k) Plans Are Difficult To Set Up And Manage
Well, some are. But, finding the right plan that fits your and your employees’ needs shouldn’t be. Financial tech companies like SaveDay® offer a $0 cost retirement plans that are managed online.
Knowing the facts about 401(k) plans will help you be a better employer. Contact SaveDay® and see if your company qualifies for a $0 cost 401(k).