The American Dream tells us that our retirement years should be spent enjoying the fruits of a life of labor. Most people imagine long years of content ahead of them after they stop working. But studies show that today’s workers often lack any substantial amount of savings. Acknowledging this reality can make any retirement at all seem like an impossibility.
As a business owner, you have the power to make a significant impact on your employees’ ability to retire with dignity. Implementing a strong employer-sponsored retirement plan can give your employees the guidance and incentives they need to prepare responsibly without spending a lot of bandwidth on stressing about their future.
With the help of an experienced and qualified financial advisor, setting up and managing an employer-sponsored retirement plan can be completely painless, save you from the high cost of employee turn-over, maximize your tax savings, and attract higher quality employees to your business.
General Benefits of Financial Advisors
Peace of mind is probably the biggest benefit of working with a financial advisor. It’s already taxing work to run a business. Trying to manage your business’s finances, run your employees’ retirement plan while protecting yourself from ERISA suits, avoid needlessly inflated tax burdens, prevent a low valuation of a solid business at selling time, and navigate the multitude of other potential financial planning pitfalls you could fall into, is likely not a wise use of your bandwidth.
A well-qualified financial advisor also helps you see your finances from a more impartial point of view. When you’ve spent a lifetime building a business from nothing, you become deeply emotionally invested in the outcomes of your decisions, which can make it easy for emotions to cloud your judgment. An ethical, professional, compassionate advisor can take a look at the big picture and give you the steady guidance you can’t bootstrap on your own.
A top notch advisor is also often able to see and fix cash flow problems that you might not even know exist. By preventing costly mistakes and strategizing with your best interests at heart, an advisor more than justifies their fee.
Hiring an Advisor for Your Employer-Sponsored Retirement Plan
So now that you know what a good financial advisor can do for your company in general, what can they do for your employees’ retirement plan specifically?
Firstly, a financial adviser who advises on your employees’ retirement plan should give you benchmarking reports. These reports help to indicate whether or not your retirement benefits plan’s fees are competitive within your industry. Having your advisor implement a strong investment due-diligence program will also keep you from running into problems with regulators.
As the sponsor of a retirement plan, you are held liable under the Fiduciary Rule. This regulation (from the Department of Labor) states that all retirement plan sponsors need to act with their employees’ best interests in mind. When you start up a 401k or similar retirement plan, by law you become the fiduciary for that plan.
Aside from protecting you legally and making sure that you’re using your resources in the most efficient way possible, an advisor can also help you organize a financial education plan for your employees. You want your people to understand and be able to gain the maximum benefit from the plan you institute. Having an advisor manage employee training on their benefits should free you up to stay focused on the work you do best.
Choosing a Plan
Your advisor will analyze your company and help you determine which plan is best for you. Depending on the number of employees you have and the amount of money or stock you’d like to dedicate to this project, a 401k, SEP, Simple IRA, 457, or even a defined benefit plan might make the most sense.
If this seems like a lot, don’t worry! Your financial advisor is there to guide you through the different plans and advise you on the pros and cons of each!
Why Waste Another Minute?
If you care about attracting and keeping the best employees, if you think that your emotions or your workload has ever had an impact or could have an impact on your financial strategy, if you would like to pay less in taxes, if you want protection from ERISA suits, and if you have an interest in being prepared to transition out of your business at some point and enjoying a comfortable retirement, you should talk to a financial advisor as soon as possible.
To get matched with a financial advisor who has specific expertise in helping folks just like you, reach out and schedule a call with us. We’ll ask you a few questions about your situation and goals, then match you to an advisor on our platform who has the skills to help you out. Once you’re matched, we’ll schedule you an appointment for a free initial consultation with that advisor so you can get started on a better future.