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Why offer a retirement plan?
The benefits you as an employer provide in the workforce are vital tools for attracting and retaining valuable employees. A high-quality retirement program is one of the most important components in an employee benefit package, behind only medical care options and paid vacation privileges. In fact, an estimated 64.3 million full-time employees are eligible to participate in qualified plans in the United States (EBRI Notes, Sept. 2000, Table 4).

Not only is a retirement plan an excellent tool for attracting and retaining high-quality employees, it is also a solid way to reduce your company's tax burden and to set aside money on a tax-deferred basis for your own retirement.

Qualified plans are one of the best ways to help employees accumulate retirement savings. Benefits include:

• The opportunity to keep your company competitive, especially in a changing labor market
• Tax-deductible employer contributions to a qualified plan
• A tax credit of up to $500 may be available to small companies (generally fewer than 100 employees) for the costs of creating or maintaining an employee retirement plan

In addition, your employees benefit by being able to make tax-deferred contributions and enjoying tax deferral on investment earnings.

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