Less than a quarter of small-business owners with fewer than 50 employees (24%) offer workers a 401(k) plan, according to a survey commissioned by 401(k) provider ShareBuilder 401k.
More than half of the 500 business owners surveyed (55%) believed their businesses were too small to access a plan, a misconception given that any size business can offer a retirement plan. Others also mistakenly believed they had to offer a company match, with 28% saying they didn’t offer a plan because they couldn’t afford to offer an employer match.
More than 1 in 5 (22%) believed that offering a plan would be too expensive, with only 18% aware of the tax credits available under the SECURE 2.0 Act to reduce the cost of offering a 401(k) plan for the first time.
“The need to debunk these misconceptions about the access and affordability of 401(k) plans for small businesses is essential to help a large swath of Americans to have the option to retire with financial security,” said Stuart Robertson, CEO of ShareBuilder 401k, in a news release.
The survey was based on 500 U.S. small-business owners running enterprises with 1-50 employees. It was conducted April 19-24.
