What is involved in adopting a qualified retirement plan?
FIRST, call us at ALI Actuarial & Retirement Plan Services. We can walk you through the process and handle all the set-up issues for you. Briefly, here are the vital steps.
1) Determine Your Objectives. Too many employers get confused by trying first to analyze the types of retirement plans available, and second to figure out what they should do. It's much easier to first decide what you want to accomplish, and then let a qualified retirement specialist like ALI Actuarial & Retirement Plan Services determine what type of plan you need.
2) Get A Plan Analysis. ALI Actuarial & Retirement Plan Services will model several different types of plans and levels of contributions/benefits based on your current population. You will see exactly what the contributions and benefits are for all eligible employees. We do not charge for this type of analysis.
3) Get The Plan Properly Designed. ALI Actuarial & Retirement Plan Services can help properly design the plan. Can certain employees be excluded? Can contribution or benefits be slanted more toward certain employees? Can the employer's tax deduction requirements be met by one plan, or is a combination of plans appropriate? What should the vesting schedule be? Should the plan allow loans, and if so, what should the interest rate, fees, and limits be? Will the employer be stuck with large contributions in poor financial years? Should the plan be filed with IRS? All of these issues should be addressed when the plan is designed.
4) Determine How Plan Assets Will Be Invested. You may invest in almost any mainstream investment; stocks, bonds, mutual funds, certificates of deposit, etc. You must be wary of nebulous investments such as parcels of land, and anything else whose market value cannot be easily obtained on an open market. You may NOT invest in assets of the company, collectibles (such as stamp collections), antiquities, or other such items.
5) Obtain a Plan Document. Once you have completed the above steps, you are ready to adopt a retirement plan. Next, you will need a Plan Document, a legal contract governing the plan contributions and benefits. This document must spell out EXACTLY how the contributions or benefits are determined, who is responsible for investments, who is eligible to be in the plan, when they become eligible, how vesting is determined, how benefits are paid out, plan loan or hardship withdrawal provisions, etc.
Fortunately, you do not need to hire an ERISA attorney to write you a plan document. You can instead adopt one of the prototype retirement plans offered by ALI Actuarial & Retirement Plan Services. Just click on one of the buttons above and enter the required information. The cost of adopting a prototype plan over our website is $1,995 (savings of $300 over our regular price). Just send us a check for the $995 down payment (or pay by credit or debit card through the Payments button on our website), complete the required data items, and we will contact with you within 2 business days to confirm the information and start your plan.