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 6 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 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 a 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® offers a $0 cost retirement plans that are managed online.