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The Business of Savings
Five advantages of starting a 401(k) today
Many small business owners second guess starting a 401(k) plan and never find the time to do it. The great thing is that the sooner you start a retirement plan the better off you tend to be on many, many fronts:
- Lowering your taxes this year with tax-deferred contributions (or even hedge against future tax increases with a Roth 401(k).
- You can build a next egg that matters. If you’re young, you have the power of compounding on your side that can make it easier to reach your goal. Start late and you can contribute up to $22,000 a year once your 50 over older ($16,500 if under 50).
- You get access to cash in emergency with 401(k) loans so you have some flexibility here.
- You help your employees save too plus it helps retain your key players and keep those hiring costs in check.
- Who else is going to help you come retirement if you don’t? Social Security and other programs may not be fully there for you.
Given it takes all of about 20 minutes to purchase and setup your plan which will be ready to deploy a few weeks later, now is truly a great time to start something that is good for you and your company.