Fidelity's SIMPLE IRAs have no setup fees, no monthly service fees, no custodial fees and no advisory fees, making this provider a cost-effective choice for businesses with tight budgets. Traditionally, 401(k) plans were unwieldy for many small businesses because, to comply with federal ERISA regulations, you had to enlist several companies to help with administration duties, recordkeeping, investment management and compliance testing.
Guideline does it all, and it also serves as the ERISA 3(16) and 3(38) fiduciary.
Here's an overview of the fees you can expect to pay.
Employer-sponsored IRAs are much simpler to set up and maintain than 401(k) plans, but they don't allow employees to set aside as much money in their workplace retirement plans.
When you're evaluating how much an employee retirement plan costs, there are two sets of pricing that you need to consider: your costs to sponsor the plan and your employees' costs to participate in it.
These costs vary by the type of plan you offer and the provider.Fidelity Investments offers the best Savings Incentive Match Plan for Employees – or SIMPLE IRA – for small businesses because of its lack of fees for plan sponsors and its low costs and complimentary investment guidance for plan participants. They also pay fund expense ratios, though commission-free exchange-traded funds (ETFs) from Fidelity and i Shares are available, helping to keep these costs low.This type of plan is for businesses with 100 or fewer employees and requires plan sponsors to either match a small percentage of each participating employee's contributions or contribute a smaller percentage to all employee accounts. Guideline offers the best 401(k) employee retirement plan for small businesses because it's a full-stack solution with low fees.When you sign up with Guideline to sponsor a 401(k) plan, you don't pay advisory fees, custodian fees or assets-under-management fees.Rather, you pay a setup fee and then a monthly service fee based on the number of plan participants.Although it's expensive, this is a standard fee that covers the costs of transferring assets and handling the paperwork associated with shutting down a plan.Share Builder 401k, formerly Spark 401k by Capital One, is the best safe harbor 401(k) retirement savings plan for small businesses because it's easy and affordable for small business owners to sponsor.Some of these companies use "robo advisors" that use algorithms to manage assets, allowing them to forgo fund management or advisory fees, so you only pay the fund expense ratio.Most of these companies offer low-fee index funds and mutual funds to keep expense ratios down.Some companies offer multiple services in-house but charge extra for some of them. They take care of administration, record-keeping, custodian and advisor duties, so you only need to work with one company.They also act as an ERISA 3(38) fiduciary, which lowers your liability risks.