Determine the Right Plan for Your Business

Arvest Wealth Management has a retirement plan consulting team that can help you evaluate your options and review your current group retirement plan. The goal is to help you to understand all the costs associated with a plan, including administration, recordkeeping and investment options. Our years of experience and dedication to the employer-sponsored retirement plan area provide a level of service and accountability that is rare in our industry.

Several plan options are available to your business:

SEP-IRA

These plans are ideal for small organizations or self-employed individuals. They are easy to establish and have no special governmental filing requirements. Employer contributions are limited to the lesser of 25% of total compensation or $69,000 (2024).

Simple-IRA

These plans are for companies with 100 or fewer employees. Employees can contribute a maximum of $16,000 (2024), and employees age 50 and older may make an additional catch-up contribution of $3,500 (2024), bringing their annual maximum to $19,500 (2024). Employers can choose to make a 2% contribution to all employees or an optional matching contribution of up to 3%. The appeal of SIMPLE IRAs is that they have minimal paperwork requirements, just an initial plan document and annual disclosures to employees.

401(k) Plans

These plans are popular because of their flexibility and the higher limits for employee and employer contributions. Employees can defer up to 100% of their wages with a limit of $23,500 (2024), and employees over 50 may make an additional contribution of $7,500 (202). Employers can make matching contributions to the plan. There can be significant administration needed and annual filings are required.

Defined Benefit Pension

A defined-benefit plan is an employer-sponsored retirement plan where the employer makes contributions to the plan to fund predetermined retirement benefits for each employee. Contribution amounts are computed using a formula that considers several factors, such as length of employment and salary history. Some employers find that defined benefit plans offer some advantages over defined contribution plans (401(k) and profit-sharing plans) such as higher contribution limits. However, defined benefit plans are often more complex and are usually more expensive to establish and maintain than other types of plans. Only employer contributions are allowed in this type of plan.

Profit Sharing Plan

A profit-sharing plan is a retirement plan that gives employees a share in the profits of a company. Employers may make a discretionary annual contribution into employee retirement accounts up to 100% of each employee's salary or a maximum of $69,000 (2024). Only employer contributions are allowed in this type of plan.

403(b) Plan

Similar to a 401(k) plan, a 403(b) plan is a retirement account for certain employees of public schools and tax-exempt organizations. Participants include teachers, school administrators, professors, government employees, nurses, doctors, and librarians. Religious organizations may also participate in these plans. Both employee and employer contributions are allowed in these plans and the annual limits are similar to 401(k) plans. Employees can defer up to 100% of their wages with a limit of $23,000 (2024), and employees over age 50 may make an additional catch-up contribution of $7,500 (2024). Employers can make matching contributions to the plan. There can be significant administration needed and annual filings are required.

For businesses, nonprofits, and government agencies, Arvest Wealth Management offers specialized solutions and support that help you manage investments, oversee custodial accounts, and provide employee benefits.