A small business owner in Maine asked us for assistance evaluating plan options for their business. We were asked to help determine whether a SEP, SIMPLE, or a 401(k) plan would help best meet their objectives. At the time, a SIMPLE IRA was perfect for them to continue growing their small business while being able to benefit from the retirement plan. After several years of working with them on their SIMPLE IRA, it was time for a change. Their number of employees had increased and they were rapidly expanding. They were quickly outgrowing their SIMPLE IRA. Our mission was to create a customized, tax-efficient, and competitive plan that caters to the unique needs of base-level employees, key personnel, and owners.

How Pine Harbor Helped

Working with Pine Harbor, the local business sought assistance in assessing and enhancing its retirement plan. Recognizing the need for improvement, we recommended transitioning from the SIMPLE IRA plan to a 401(k) plan. This shift not only increased annual contribution limits for all employees but also introduced a profit-sharing component aligned with the company’s strategic and financial objectives. We focused on customization, tailoring the plan to adapt to the needs of all employees while maximizing benefits for key personnel.

By introducing a cash balance benefit and a thoughtful plan redesign, Pine Harbor significantly increased retirement contributions for base-level employees and enhanced the savings potential for key executives. The revamped plan allowed employees to retain more of their compensation and improved overall tax savings. Additionally, our team fortified the investment offerings with a robust platform and a diversified fund lineup and implemented a documented fiduciary process for better due diligence and participant education.

How the Business Benefitted

The business leaders expressed satisfaction with the outcomes, emphasizing the importance of revisiting the retirement plan strategy for their growing organization. The plan's efficiency ratio rose significantly, showcasing the success of the transition from the SIMPLE plan to the 401(k) design. The customized approach improved plan design, investments, and cost efficiency and empowered employees for greater retirement readiness. Business leaders acknowledged Pine Harbor, stating that the team benefited their business.

_{All investing involves risk, including the possible loss of principal. There is no assurance that any investment strategy will be successful.}