Small business owners can have dramatically different goals for their 401(k) plan.
While some want to maximize key employee contributions, others want to incentivize plan participation by all employees. Business owners have nearly endless options for meeting these goals – many with very different expenses. The process of matching 401(k) goals to available options is called plan design.
401(k) plan design is a big deal that shouldn’t be undervalued by business owners.
One of the most common questions we receive during the plan design process is “what are other people doing?” To help answer this question, we studied the contribution and eligibility provisions of 3,975 small business 401(k) plans in 2019. To see if preferences have changed, we completed a new study of 4,330 401(k) plans this month.
For more information, visit www.employeefiduciary.com.
401(k) Must Reads
If a 401(k) plan does not timely adopt a Cycle 3 document restatement, the issue may be eligible for self-correction under certain circumstances.
Revisions to the 2022 Form 5500 were recently finalized. However, public comments are still being evaluated.