TITLE

Could the Small-Company Retirement Gap Be Closing?

AUTHOR(S)
Opiela, Nancy
PUB. DATE
July 2002
SOURCE
Journal of Financial Planning;Jul2002, Vol. 15 Issue 7, p46
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This article focuses on the attitude of U.S. small-business owners toward retirement plans for their employees. The most common reasons small employers with 100 or fewer employees, cited for not offering a retirement plan were the high cost of setting up and administering the plan, and the amount of government regulations involved. It is no surprise, then, that only 46 percent of employees in small businesses are covered in an employer-based retirement plan, versus nearly 80 percent of full-time employees in medium- and large-sized firms, according to the U.S. Department of Labor. Planners like Mark Wilson of Tarbox Equity have successfully overcome clients' too expensive, too complex objections. Ninety percent of the small-business owners his firm works with offer retirement plans to their employee. Kent Callahan, Transamerica Retirement Services senior vice president, predicts that 2002 will be the year that the small-business retirement gap will start to close, because in addition to increased limits, the new legislation offers targeted tax credits for small businesses that start a new retirement plan. Specifically, owners of businesses with 100 or fewer employees can take a tax credit for qualified start-up costs of up to $500 in each of the first three years of the plan.
ACCESSION #
6990050

 

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