Why offer a retirement plan in the construction industry?
Certain industries are traditionally thought of as ones that have hard working employees that work for their current paycheck and if they want to save for the future it falls fully on the shoulders of the employee. In recent years, the trends have been changing. Owners of companies are seeing the benefits of offering some sort of retirement plan to employees and employees are now starting to look for companies that offer benefits. If your company is not currently offering a retirement plan below are a few reasons why you might want to consider doing so.
All companies want to have the highest quality employees that do the best work in the most efficient amount of time. One way to recruit workers that care about their job is to show them that your company cares about its employees. A retirement plan shows employees that you not only care about them while they work for you but also when their careers have ended.
Similar to the recruiting benefit, retention helps keep the employees you want to have working for you. When a retirement plan is in place it makes it harder for an employee to go work for someone else just because they are paying a little bit more an hour. Often times even the employees that don’t take advantage of the retirement plan like the idea that the company has it and find it harder to leave.
Tax benefits for owners:
This part is twofold. First when you offer a plan to your employees certain expenses from the plan are tax deductible for your business. The less taxes you are obligated to pay keeps more money in your pocket to help to continue to grow your business. Secondly the business owner can take part of the retirement plan as well to help lower their current tax liabilities while allowing them to work on life in retirement as well. With the right plan construction the plan can have a positive effect on the bottom line.
If your company is not currently offering a retirement program to the employees I strongly encourage you to start the conversation and see if it makes sense for you. I am guessing you will be surprised on how cost effective a plan can be when you find the right option for your business.
Author Greg Hayes
Greg is the Director of Financial Planning at Iron Horse Wealth Management LLC. He has 14 years of experience in the financial services industry. During that time Greg gained experience in financial education, insurance, banking, and financial budgeting/planning for both individuals and businesses. He focuses on assisting business owners and their employees with managing their retirement plans.
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