Financial Wellness 101 Retirement plans

You have probably thought about offering a retirement plan to your employees but are not quite sure if they’ll be open to one. It can be a big decision for any company, and you may be wondering if it will be worth the time or hassle to start one. But if you’re dealing with the woes of finding quality workers, financial wellness and security through a retirement plan can help you attract good employees and retain the ones you have.

If you would like to educate your team about retirement plans, here are some essentials that you can provide them:

What is it?

A defined contribution plan designed to help them finance your retirement. As a participant in the plan, they own an individual account within the plan that they contribute money to for your retirement.

What are the limits? Financial Wellness 101 Retirement plans

For the year 2022, they can contribute a total of $20,500 towards your retirement plan. Individuals age 50 and over can contribute an additional $6,500.

Salary deferral advantages.

By participating in the plan, they receive the benefit of saving via payroll deduction on a tax-deferred basis. Tax deferral on both savings and asset growth via payroll deduction helps them save more money and pay less tax upon distribution at retirement.

Tax-deferred growth.

Not being taxed on the growth of their assets helps accumulations during their working years. With their qualified retirement savings plan, they not only defer taxes on the amount they save, but earnings on their savings are also tax deferred until distribution.

Employer contributions.

If you decide to offer them, they will help them accumulate assets for retirement and can add considerably to their retirement account balance. They are also not taxed on your  contributions until distribution.

Portability.

If they change employers at some point in their career, they typically can keep their assets in the current plan, roll their assets over to a new employer’s plan or roll their assets into an IRA.

As their employer, you can even participate in the plan and save more compared to an IRA plan. Providing retirement benefits isn’t even complicated when you have Beneco on your side. Contact us today and let us show you how to maximize your fringe dollars to help your employees and even save your company money!