Author Topic: Best 401k Plan for Small Business?  (Read 418 times)

Snowman99

  • 5 O'Clock Shadow
  • *
  • Posts: 57
Best 401k Plan for Small Business?
« on: April 03, 2019, 02:42:14 AM »
What are the best, lowest cost, traditional 401k plans available for small businesses/partnerships?  Forming a business with multiple partners, which takes solo 401k plan and SEP IRA not viable/palatable.  We will be 5 partners taxed as partnership with approximately 3-5 additional employees.

My understanding was that Vanguard only offers i401k's, but a recent online search revealed the following: 

https://advisors.vanguard.com/VGApp/iip/site/advisor/support/article/SmallMarket

Is this a new product line from Vanguard?  Also saw that Betterment offers a 401k for small business.

Basically looking to minimize cost and invest 100% in low cost index funds.

Appreciate any help on this.  Thanks.

terran

  • Handlebar Stache
  • *****
  • Posts: 2457
Re: Best 401k Plan for Small Business?
« Reply #1 on: April 03, 2019, 06:12:54 AM »
I think I've seen https://www.employeefiduciary.com/ mentioned. I have no personal experience with them.

YttriumNitrate

  • Pencil Stache
  • ****
  • Posts: 717
  • Location: Northwest Indiana
Re: Best 401k Plan for Small Business?
« Reply #2 on: April 03, 2019, 06:54:02 AM »
I set up my small company's 401k through Vanguard. I believe large companies get to deal with Vanguard directly, but small companies work through a company called Acensus. They offer most (if not all) of the Vanguard products and very low expense ratios.

It was a few years ago when the plan was set up, but I remember that Employee Fiduciary was less expensive than Vanguard when total assets in the plan were under a million, and then Vanguard/Acensus was less after that. In hindsight, we probably should have gone with Employee Fiduciary, but the "Vanguard" name made it easier to get people on board with that specific plan.

OldandGrumpy

  • 5 O'Clock Shadow
  • *
  • Posts: 8
Re: Best 401k Plan for Small Business?
« Reply #3 on: April 03, 2019, 07:19:43 AM »
In my experience a "Safe Harbor" 401k plan is the way to go.

A "Safe Harbor" plan avoids most of the contribution limitations due to 401k plan testing failures.

A "Safe Harbor" plan will allow highly compensated business owner/employees to maximize contributions to the plan.


marbar

  • 5 O'Clock Shadow
  • *
  • Posts: 8
Re: Best 401k Plan for Small Business?
« Reply #4 on: April 03, 2019, 09:18:11 AM »
Check out Guideline. https://www.guideline.com Extremely simple and good fund offerings.

I previously dealt with a Vanguard plan, and the experience was quite terrible. Too many middlemen and manual steps to deal with