By: Steve Zylstra, president & CEO of the Arizona Technology Council and SciTech Institute
In today’s job market, it is more important than ever to offer a comprehensive benefits package to attract and retain top-tier technology talent. That’s why the Council partnered with Empower Retirement (formerly MassMutual) and UBS Institutional Consulting Group to offer member companies exclusive access to our 401(k) Multiple Employer Plan (MEP).
By opting into this plan, you can enjoy all the advantages and flexibility of a stand-alone plan while avoiding the expenses, fiduciary liabilities and administrative headaches of sponsoring your own plan. The process is as simple as setting up an IRA, but with the added benefits of low-cost investments, no tedious paperwork or reporting, minimal plan maintenance, flexible plan features and customizable plan design options.
Do you have a SIMPLE IRA?
Typically, smaller companies with less than 100 employees open SIMPLE IRA plans for their employees because of the perception of being less expensive and complex. Because of your membership in AZTC, you can adopt a full-service 401(k) that is fully customizable and not limited to the more restrictive rules of a SIMPLE IRA.
Contribution Limits
Under the 401(k) plan, employees can contribute $20,500 of their salary on a pre-tax or post-tax basis. With a SIMPLE IRA, the maximum contribution is only $14,000. Employees 50 years old and older can also make catch-up contributions of $6,500 with a 401(k) vs $3,000 in a SIMPLE IRA.
Matching Contributions
With a 401(k) plan, you can design the plan to include a match based on your budget. You can be as restrictive or generous as you want. With a SIMPLE Plan, you will be required to make a minimum match or non-elective contribution to all employees.
With this full-service plan as part of your benefits package, your company will be better equipped to compete with fortune 500 companies in their search for highly qualified professionals, even if you’re a startup with just a few employees. And the best part? This MEP takes care of the 401(k) administration and enables you to do what you do best – operate and grow your business.
Visit https://www.aztechcouncil.org/pbp/aztc-401k-multiple-employer-plan/ to learn more and set up a consultation with Michael DiGrazia, the Council’s dedicated financial advisor.
