Get The Facts About Your 401K MEP
What To Know About Your 401K MEP
A 401K MEP, also know as multiple employer plan, offers many of the same investment advantages as a standard 40K plan. The basic concept of a 401K MEP allows unaffiliated employees to participate in a common retirement investment plan. Under 413(c) of the Internal Revenue Code, contributing business owners offer retirement savings options under the sponsorship of a third party provider. The third party provider oversees investments, employee/employer participation, and assumes responsibility for administering as needed within the plan.
Does A 401K MEP Make Sense For Your Business?
Working with the right third party provider can make all the difference in your MEP experience. Many businesses owners are surprised to learn that any employer is eligible to offer this type of retirement option to their employees. Finding an experienced team that specializes in MEPs will streamline your plan development process. When screening potential providers, look for a firm that offers a diverse range of options. Whether you are a start-up organization, or a national brand with multiple locations, you will want an investment team capable of meeting you where you’re at now, and have the flexibility to grow with your business.
Know The Benefits Offered By This Retirement Savings Plan
Additionally, using a 401K MEP yields several key benefits, making it an ideal option for entrepreneurs running companies of every size and scope. Perhaps the biggest advantage to this type of savings format? It often proves more cost-effective when compared to a standard 401K-investment strategy. A professional provider manages the plan on your behalf, instantly freeing up time as well as saving your organization administrative costs. Also, participating in a plan with other businesses allows you to enjoy volume savings instead of absorbing individual plan costs. Finally, an efficient provider will know how to capitalize on funds that require lower fees.
Most importantly, a MEP allows for design customization so your organization enjoys a perfect investment fit. When working with your third party partner, discuss your specific needs such as vesting schedule, whether your company will match contributions and overall eligibility requirements. Once you’ve outlined your investment goals, your vendor will develop a final format to launch to employees.
Want to learn more about using a MEP? Contact The Payroll Company today.