The small business part of the 401(k) business is a bit tough, a recent survey shows that.<\/p>\n
A survey from Capital Group found that main reasons for small businesses not creating retirement plans were costs, complexity, and concerns about the size and stability of their business.<\/p>\n
305 employers were part of the survey, 105 offered a retirement plan and 200 did not. About 75% of the businesses in the survey that lacked a plan said they were interested in creating one, but only 13% said it would happen in the next six months.<\/p>\n
The reasons employers gave for not offering a plan were about complexity and expense. Thirty-nine percent said their business was not large or stable enough, 35% cited limited administrative resources, 32% said they didn\u2019t know where to start, and 32% said plan creation is too expensive for them. For smaller companies, I think Pooled Employer Plans and educating sponsors about them, can go a long way in breaking down the barriers.<\/p>\n
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