The American Student Loan Crisis – Plan Sponsor Solutions

The American Student Loan Crisis – Plan Sponsor Solutions

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At the end of each spring semester, millions of college graduates in the United States celebrate their college diploma in return for their hard work. With the hopes that their degree will bring a successful career, these graduates enter the workforce, often bringing with them tens of thousands of dollars in student loan debt. With 44.7 million Americans currently carrying an estimated $1.5 trillion in student debt, this financial burden will remain with many for decades. And as these graduates become part of the employee population of many companies, employers are now exploring their role on how they can assist with tackling this debt.

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Maximizing Plan Design to Drive Better Outcomes

Maximizing Plan Design to Drive Better Outcomes

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A successful retirement plan program encourages and enables its participants to build sufficient retirement savings, choose the appropriate investments, manage investment risk, and generate a lifetime of income. Although there exist nearly as many retirement plan structures as individuals who participate in them, not all plans are created equal—and plan design can significantly influence savings and retirement decisions. However, due to the number of options available, plan design can be a complex undertaking. Learn more about the plan design features that will boost your plan participants’ readiness for retirement.

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What is a Safe Harbor 401(k) Plan?

What is a Safe Harbor 401(k) Plan?

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There are a few types of 401(k) plans available to plan sponsors: the traditional 401(k), the Roth 401(k), the SIMPLE 401(k), and the Safe Harbor 401(k). Each plan has different benefits and drawbacks, but they all share one common feature: a requirement that the plan sponsor abides by that specific plan’s rules and regulations. Most 401(k) plans face an annual nondiscrimination test defined by the Internal Revenue Service (IRS), which ensures that the plan does not excessively favor highly compensated employees (HCEs) and that their contributions do not exceed the average contributions of non-highly compensated employees (NHCEs) by set limits. Failing to adhere to the IRS’s rules can risk the loss of the 401(k)’s preferable tax status and can be subject to penalties.

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How To Make A 401(k) Contribution For Your Employees When You Can’t Afford An Ongoing Match

How To Make A 401(k) Contribution For Your Employees When You Can’t Afford An Ongoing Match

Posted on by Mark OlsenLeave a comment

One of the things employees get most excited about regarding retirement plans is matching contributions. While this is “free money” to the employees, it is not to the company sponsoring the plan. A lot of large companies offer matching contributions, but many small- and mid-size businesses just aren’t financially stable enough to do so.

What can you do if you want to help your employees save towards retirement, but can’t afford to promise a certain percentage every year? Make discretionary contributions.

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