SIMPLE IRA vs 401(k)

Can a 401(k) better serve your clients?

Small business owners just starting off often set up a SIMPLE IRA to save for retirement.

As the business grows and the owners reach their contribution limit many outgrow their SIMPLE IRA and need a better savings vehicle.

Here is how a 401(k) can better serve your business owner clients:

SIMPLE IRA	Bundled	Unbundled
$20,000 contribution limit (includes catch-up)	$77,500 contribution limit (includes catch-up)	$57,500 more in savings
No Profit Sharing	Profit Sharing available	Flexibility to tailor Profit Sharing to specific groups
Mandatory contributions to the employees’ accounts	The option to make contributions to the employees’ accounts	$500 tax credit (3 years) for automatic enrollment*
No vesting schedule	Vesting schedule available	Provides incentive compensation that encourages plan retention
Individual plan for each participant	One group plan for all participants	Save time with group meetings for plan enrollment and education

*See SECURE 2.0 Act Tax Credits

At Trinity, we make complex pension concepts simple, and our seamless conversion process creates a smooth transition. Every client has access to a dedicated Relationship Management team to provide clear and consistent communication.

Plus, our Trinity Pro and 3(16) Services offers the convenience and protection your business owner clients want. With Trinity, every client's plan is tailored to truly fit their business needs and goals from service to plan design.