Affordable and Hassle-Free 401(k) Plans for Small Businesses | Saveday

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As a small business owner, providing a 401(k) plan for your employees is a significant step towards their financial well-being and your company’s growth. However, the cost associated with setting up and managing a 401(k) plan can be a concern. Many companies tack on expensive startup fees, monthly and annual employer costs, per-employee fees, and other buried charges.

But with saveday, you can offer this valuable benefit without any startup cost. Saveday simplifies 401(k) plans for small business owners, eliminating the financial burden and reducing administrative hassle.

5 Ways Saveday Makes 401(k)s Affordable for Small Business

  1. Cost Savings: Saveday’s $0 startup cost removes the financial barrier that deters small businesses from offering retirement benefits. By waiving setup fees, saveday provides a robust savings solution within your budget.
  2. In-House Strategy: Saveday’s fully-bundled strategy eliminates at least 50% of industry average plan costs. With all plan requirements handled in-house, including Registered Investment Advisor, Broker/Dealer, and 401(k) Administrator, we save you money by not charging for revenue sharing with distribution partners.
  3. No Hidden Fees: Unlike competitors, saveday offers transparent pricing and a low AUM fee. We don’t burden you or your employees with monthly, annual, or per-employee fees. More money stays with you and your employees, as it should in retirement planning.
  4. Simple Plan Offerings: Saveday provides simple and flexible plan options tailored to your business’s needs. Whether you’re a sole proprietor or a growing startup, we can customize a 401(k) plan that aligns with your goals. Unlike other providers, we treat all plans equally, ensuring fair access to desirable features.
  5. Seamless Administration: Saveday’s intuitive platform simplifies plan administration. With payroll integration and automated processes for onboarding, contribution management, and reporting, we streamline the administrative tasks associated with a 401(k) plan. Focus on running your business while we handle the rest.

Saveday’s $0 startup cost for a 401(k) plan enables small business owners to offer this vital benefit without financial strain. By providing a 401(k) plan, you support your employees’ financial future and attract top talent to your business. With legislative tailwinds pushing towards mandatory retirement benefits, take the proactive step and offer benefits today to avoid state-mandated deadlines and penalty fees. Trust saveday to make retirement planning accessible, affordable, and hassle-free for your business.

Setting Up a 401(k) as a Small Business: Key Requirements and Restrictions

As a small business owner, you may be considering the benefits of offering a 401(k) plan to your employees. You may live in a state that is mandating businesses to offer retirement plans and are investigating private plan options. Whatever your situation, saveday is here to help navigate the dos and don’ts of sponsoring a retirement plan.

 A 401(k) plan is a popular retirement savings method that provides tax advantages for both employers and employees. However, before diving into the world of retirement plans, it’s important to understand the key requirements and restrictions associated with setting up and managing such a plan.

Who can set up a 401(k) plan?

A 401(k) plan can be established by various types of small businesses, including sole proprietorships, partnerships, limited liability companies (LLCs), corporations, and certain non-profit organizations. The eligibility to set up a 401(k) plan depends on the structure and nature of the business. To learn more you can read the IRS 401(k) page here, but we’ve listed the key considerations below…

Key Considerations:

  1. Eligibility: A 401(k) plan must be offered to all eligible employees, which includes part-time workers, as long as they meet specific criteria such as age and length of service. Ensuring compliance with eligibility requirements is essential to avoid discrimination issues. Saveday can help you navigate the eligibility criteria and ensure that your plan is inclusive and compliant.
  1. Contribution limits: The IRS sets annual limits on the amount employees can contribute to their 401(k) accounts. For 2023, the elective deferral limit is $20,500, with an additional catch-up contribution of $6,500 for individuals aged 50 or older. These limits are subject to adjustment by the IRS in subsequent years. Saveday’s platform enables easy tracking of employee contributions and ensures that they stay within the IRS limits.
  1. Employer Contributions: While not mandatory, employers have the option to make contributions to their employees’ 401(k) accounts. These contributions can take the form of matching contributions or profit-sharing contributions. However, there are rules and limits governing employer contributions, including non-discrimination requirements. Saveday can assist you in designing and implementing an employer contribution strategy that aligns with your business goals and maximizes employee benefits.
  1. Vesting: Vesting refers to the ownership of contributions made by the employer. The IRS has specific rules on vesting schedules, which determine when employees have full ownership of employer contributions. Understanding vesting schedules is crucial for both employers and employees. Saveday can help you establish vesting schedules that are fair and compliant with IRS regulations.
  1. Testing and Reporting: The IRS requires certain tests to ensure that the 401(k) plan does not disproportionately favor highly compensated employees. These tests include the Actual Deferral Percentage (ADP) test, Actual Contribution Percentage (ACP) test, and top-heavy testing. Additionally, annual reporting of the plan’s activity is required through Form 5500, which provides transparency and accountability. Saveday offers complimentary custodial services – which means we do all the reporting and filing for you, at no additional cost.
  1. Fiduciary Responsibilities: As a plan sponsor, you have fiduciary responsibilities to act in the best interests of the plan participants. This includes prudently selecting and monitoring investment options, providing plan information to participants, and ensuring compliance with Employee Retirement Income Security Act (ERISA) regulations. Saveday can act as your ERISA 3(16) and 3(38) fiduciary, relieving you of some of these responsibilities.

Starting a 401(k) at $0 Cost to Your Business

By partnering with saveday, you’ll not only set your small business on the path to a successful 401(k) plan, but you’ll also empower your employees to achieve a secure retirement. With our expertise and personalized guidance, saveday becomes your trusted ally in navigating the complexities of 401(k) plans. We’ll ensure that you meet all key requirements, comply with regulations, and provide your employees with valuable benefits.

Don’t wait any longer to take the first step towards offering a competitive retirement savings option for your employees. Contact saveday today and discover how our services can make a significant difference in your small business. Together, we’ll create a plan that meets your unique needs and helps your employees build a solid financial future. Your commitment to their well-being will set your business apart and contribute to their long-term success. Let saveday be your partner in making it happen.

Form 5500: Different Types and Eligibility Criteria

Form 5500 is a crucial reporting requirement for employee benefit plans, providing valuable insights into their financial health and operations. It’s important to understand the different types of Form 5500 and the specific eligibility criteria set by the IRS. In this post, we will explore the Long-Form, Short-Form (SF) and EZ versions of Form 5500, clarifying who is eligible for each one based on IRS criteria. This knowledge will help ensure compliance and simplify your reporting obligations. Questions about the Form 5500? Check out our Form 5500 FAQs here.

Types of Form 5500 and Eligibility Criteria:

  1. Long-Form (Form 5500):

The Long-Form version of Form 5500 is a comprehensive report designed for larger plans or those with complex features. It asks for detailed information about your plan’s operations, including financial statements and attachments. By providing a complete picture of your employee benefit plan, the Long-Form helps meet regulatory requirements, maintain transparency, and facilitate thorough reporting. It is required for plans with 100 or more participants at the beginning of the plan year. 

  1. Short-Form (SF) or Form 5500-SF:

The Short-Form, also known as Form 5500-SF, is a simplified reporting option for small plans. It reduces the reporting process by eliminating certain schedules and attachments required in the Long-Form. The short-Form focuses on essential plan information, ensuring compliance while easing the reporting burden. It is suitable for plans with fewer than 100 participants at the beginning of the plan year, offering a simpler approach to meet reporting obligations. 

  1. EZ or Form 5500-EZ:

Form 5500-EZ, also called the EZ version, is the simplest reporting option. It is specifically designed for one-participant plans or plans with no participants such as individual 401(k) plans or certain foreign plans. The EZ version requires minimal information, making it a straightforward choice for small plans with simple structures. It offers an easy and streamlined process for eligible plans to meet their reporting obligations. 

Navigating the nuances of Form 5500 and understanding the eligibility criteria for each version is crucial for accurate and compliant reporting. Saveday, as your trusted 401(k) provider, can give expert guidance and support throughout the process. Our experienced team will help determine the appropriate form based on your plan’s characteristics, ensuring compliance and simplifying your reporting obligations. 

Want to learn more about how saveday can simplify Form 5500? Discover your simplified options here!

Understanding Form 5500: Essential Reporting for Your Employee Benefit Plans

Navigating employee benefit plans and ensuring compliance can be overwhelming for small business owners. However, with the right resources and assistance, this process becomes more manageable. In this blog post, we’ll explore the significance of Form 5500, its requirements, and how saveday, as your leading 401(k) provider, can simplify your reporting obligations. Let’s dive in!

Wondering which Form 5500 your business should file? Check out our Form 5500 eligibility post here.

What is Form 5500?

Form 5500 is an annual report required by the IRS, Department of Labor (DOL), and Pension Benefit Guaranty Corporation (PBGC) for employee benefit plans. It provides crucial information about your plan’s activities, financial condition, and overall operations.

Why is Form 5500 important?

Filing Form 5500 goes beyond meeting legal obligations. It ensures transparency, compliance, and protects the interests of both employers and employees. By submitting this form, you demonstrate your commitment to accountability and provide valuable information to government agencies for research and compliance purposes.

What information does Form 5500 require?

Form 5500 requires comprehensive details about your employee benefit plan, including general plan information, service provider details, participant counts, financial data such as assets and liabilities, types of benefits offered, operational activities, and plan funding. It offers a holistic view of your plan’s health and performance.

To learn more about the different types of Form 5500, check out our detailed guide here!

Simplified Compliance Testing

Maintaining the integrity of your 401(k) plan involves conducting compliance testing, which is crucial. At saveday, we understand the complexities involved in this process and offer you support every step of the way. Here’s how saveday can assist your small business:

  1. Fairness and Equal Opportunity:

Saveday ensures that your 401(k) plan operates fairly and provides equal opportunities for all employees to save for retirement. Through comprehensive compliance testing, saveday helps prevent favoritism towards owners or highly compensated employees, fostering a level playing field for all participants.

  1. Expert Guidance:

Saveday’s team of retirement plan experts is well-versed in IRS regulations and compliance testing requirements. They provide personalized guidance, ensuring that your plan meets all necessary guidelines and restrictions.

  1. Plan Optimization:

Saveday helps optimize your plan to ensure compliance while maximizing benefits for your employees. They analyze your plan’s structure, contribution limits, and other factors to create a tailored solution that suits your business needs.

  1. Streamlined Administration:

Saveday’s intuitive platform simplifies plan administration, including Form 5500 reporting. With automated data collection and reporting features, you can streamline the filing process, saving time and effort.

Summary

Filing Form 5500 and conducting compliance testing are crucial responsibilities for small business owners with employee benefit plans. By partnering with saveday, you can simplify these obligations, comply with regulations, and protect the interests of your employees. Transparency, fairness, and adherence to IRS guidelines contribute to the long-term success of your business and the financial well-being of your employees. Stay informed, stay compliant, and continue providing valuable benefits through your employee benefit plans. We’re with you every step of the way!