Time to think about retirement plans for small business?
Entrepreneurs, who started a small business, work long and exhausting hours and have very little time to think about retirement plans.
I know. I was one of them.
It is only when the business is growing and you start hiring that the question comes up! It is then that you realize that you'll have to find out something about retirement plans specifically for small business.
Suddenly it seems to be the key to success. The only way to attract and retain talented employees. And this is where your headache start. This is where you dilute your focus on things that you do well. Those things that launched your business to the level where you need to hire.
The only positive thing about it is that it forces you to think about your own retirement! Most distracting.
After too much time spent on investigations and presentations, I decided against an employer-provided retirement plan. We hired our people as self employed sub-contractors and we paid them considerably better than our competitors.
Each person had to get his or her own self employment retirement plan.
This strategy worked extremely well for several years. Until the company became too big and with subsidiaries in various countries. There has always been pressure. People wanted to have the security of employment with employer-provided retirement plans. Not everyone has got an entrepreneurial mindset.
Soon afterwards I retired and sold my shares.
Are there viable plans for small business?
Yes there are. The so-called SIMPLE IRA or equivalent could be used in most cases. But be aware that it's going to cost you considerably more than money!
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