Broker Check

Is Your Company Responsible for Helping Employees Prepare for Retirement?

February 13, 2015

If you’re a small-business owner or executive within a major corporation, you bear a certain level of responsibility in ensuring that your employees are prepared for retirement. Your employees, both past and present, have helped propel your company to success through hard work and long hours. When the time comes for them to step away from the job, will they have had access to resources in order to properly prepare for retirement? Make sure you’re taking the necessary steps to help your employees ready themselves for retirement with these suggestions:

Provide a Good Retirement Plan

In the current era of cutbacks and fiscal frugality, some companies and government agencies are attempting to slash retirement plans for their employees in the interest of protecting the bottom line. According to Forbes, employer-funded retirement plans are more important now than ever before for employees. Why is that?

In the past, many Americans relied upon equity in a home and savings accounts in a bank to retire comfortably. Now however, Americans are turning to 401(k) plans and other retirement offerings from employers as savings accounts dwindle and home equity shrinks.

Educate Your Employees

Whether you provide a robust retirement plan for your employees or not, you can help prepare them for retirement by providing them with educational resources on retirement. There are a number of retirement options available for your employees between company-funded options and private plans. You can start by educating them about various plans and how they work. Below are just a few plans that your employees should have knowledge of:

·         401(k): Earnings grow tax-deferred over time, but income taxes must be paid in the future when withdrawals are made from the account. The private-sector cousin of an employer-funded 401(k) is a traditional IRA. Employers make matching contributions to 401(k) plans, but not to private IRA plans.

·         Roth 401(k): Contributions to this type of plan are made with after-tax dollars, which means withdrawals made in the future are tax-free. The private-sector cousin of a Roth 401(k) is a Roth IRA. Again, employers often make matching contributions to a Roth 401(k), but not a Roth IRA.

·         403(b): Contributions are made with pre-tax dollars and earnings grow tax-deferred over time. Most employers do not make matching contributions to 403(b) plans. Employees working less than 20 hours per week may be excluded from these plans.

Education extends beyond providing simplified information about available retirement plans. You can also host seminars for your employees that offer them fundamentals in budgeting and saving. Many Americans are living paycheck to paycheck, with few discretionary funds. Budgeting and savings seminars can teach them to manage their money more effectively and save for the future. 

Provide Tools for Success

Finally, you can provide your employees with additional tools to help them prepare for retirement ahead of time and thrive during their retirement. Resources available from government agencies, such as Thrift Savings Plan, can help your employees by guiding them through investment strategies, walking them through retirement planning phases, calculating how much needs to be saved and then providing insight into responsible living during retirement.


Manhattan Ridge’s Corporate Retirement Plan offers you the ability to provide your employees with all of these points and more. Manhattan Ridge Advisors will enable you to help your employees to maximize and benchmark their retirement plans. Our advisors will also assist you in retaining and rewarding key executives. Contact a Manhattan Ridge Advisor today to get your corporate retirement plan started.