A SIMPLE IRA gives you & your employees 401(k)-style features for less
A Savings Incentive Match Plan for Employees (SIMPLE) – is an affordable, IRA-based retirement savings program designed with some of the characteristics of a 401(k) in mind. It can be established by any employer with no more than 100 employees during the preceding calendar year.
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Make saving for retirement SIMPLE
A SIMPLE IRA allows both you and your employees to save for retirement through work. A SIMPLE IRA allows you to contribute part of your pre-tax compensation to an IRA. This means the tax on the money is deferred until withdrawal.
As the employer, you are required to make either matching contributions or non-elective contributions on behalf of your employees, (non-elective means the contribution is made for each eligible employee regardless of whether the employee contributes).
Plan Details
Who's Eligible?
Employees that received at least $5,000 in compensation during any two preceding years, regardless of whether or not those two years happened consecutively, and are expected to earn at least $5,000 during the current calendar year are allowed to participate.
Employees cannot opt-out of participation; however, they can choose not to contribute for a year. You can also exclude employees under certain circumstances.
Visit the IRA website for SIMPLE IRA Plan Participation FAQs.
How Do I Contribute as an Employer?
As an employer, you have two options for how you can contribute to your employees’ IRAs:
1. Match employee contributions dollar-for-dollar up to 3% of compensation, or
2. Make 2% nonelective contributions to all employees.
In two years of any five-year period, you may reduce the required dollar-for-dollar match to as low as 1% of participant employee compensation. There are additional instances where employer contributions may vary from the above descriptions.
How Do My Employees Contribute?
An employee may defer up to $13,000 in 2019. Employees age 50 or older can make a catch-up contribution of up to $3,000.
Employee contributions will be chosen by each employee and expressed either as a percentage of compensation for the year, or as a specific dollar amount.
Visit the IRS website for more details on Simple IRA Plan Contribution FAQs.
Features & Benefits
Investment Options
You and your employees will have access to investment options selected and monitored by Morningstar Investment Management LLC* to provide sufficient choice without overburdening participants, and is designed to provide access to assets across a broad spectrum of capitalization and investment strategy.
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Morningstar Investment Management LLC is a registered investment adviser and subsidiary of Morningstar, Inc. Morningstar Investment Management uses its affiliate, Morningstar Research Services LLC, registered with and governed by the U.S. Securities and Exchange Commission, as a sub-adviser in providing an investment lineup to The Plan Sponsor. The investment lineup provided to The Plan Sponsor by Morningstar Investment Management is derived from the universe of investments made available by Millennium Trust Company for use in its service. The universe does not include all investments available in the marketplace. Both the universe of investments defined by Millennium Trust Company and the list of investments selected by Morningstar Investment Management LLC are subject to change without notice. Particular investments in the investment lineup may not be appropriate investments for individual employees, and there may be other investment options that are more suitable. Morningstar Investment Management may have more favorable opinions of certain investments which are not included in the universe made available by Millennium Trust Company. Morningstar Investment Management’s selections were based on qualitative factors and quantitative analysis in addition to the judgment of analysts. Morningstar Investment Management is not acting in the capacity of adviser to investors. The Morningstar name and logo are registered marks of Morningstar, Inc.
Automatic Enrollment
Automatic enrollment has been proven to more than double participation rates in retirement plans, and with a SIMPLE IRA from Millennium Trust you can elect to have eligible employees automatically enrolled in your new plan.
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Participating employees can also elect to have Automatic Elective Deferral Increases to help them save more for retirement.
SIMPLE IRA Pricing
Fees to the Employer
Set-up fee $250
Contribution Reversal Fee $15
Fees to the Employees
Annual Account Fee $40
Annual Servicing Fee 50 basis points*
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*Financial comparisons use basis points to track very small percentages. One basis point is simply 1/100 of one percent.