The Hartford

Many small business owners would like to have a retirement plan, but may be concerned that they’re too expensive, cumbersome or confusing. With today’s small business retirement plan options, nothing could be further from the truth. Whether you run a business on your own, with your spouse or business partner, or have several employees, there’s a retirement plan that may be right for you.

Offering a retirement plan can help you retain key employees and attract new talent, and allow you to invest in your future – and theirs – with tax-deductible contributions.

The Hartford has been helping businesses just like yours find ways to save for the future—while saving on costs. We offer a variety of retirement plans designed with the small business owner in mind, so you can keep your mind on running the business.

For more information on Small Business Retirement Plans, view Details and Services.
 

Invest in Your Financial Future

Start planning for tomorrow today, with The Hartford’s retirement plans designed for small businesses. No matter how your business is established, you can choose from a variety of tax-advantaged plans that may fit your needs. Following are just some of the options available. Your financial advisor, legal counsel,  and tax professional can help you select the plan best suited for you. 

These are high level overviews and employers should discuss with a qualified tax advisor to understand all applicable requirements.

SIMPLE IRA

Just as the name implies, the SIMPLE IRA makes it easy for small business owners to offer a retirement plan. The low cost, ease of administering and limited required contributions makes this plan ideal for owners who want a no-hassle, uncomplicated option.

You and any employees decide how much to defer into the plan (up to $11,500 each in 2012, plus an additional $2,500 if over age 50), then you can choose, subject to certain conditions,  to either:

• match any deferrals dollar-for-dollar up to a maximum 3% of compensation, or 
• make a 2% contribution of compensation for all eligible employees, regardless of whether they contribute.

SEP IRA

If you want more control over how much the business contributes, the SEP IRA is another option to consider. These plans are generally easy to administer, inexpensive to operate and offer flexibility regarding contribution amounts from year to year – or even to make no contributions in a given year. With higher limits than the SIMPLE IRA, the business can contribute a maximum 25% of compensation, up to a yearly per-person limit of $49,000 for 2011 and $50,000 per person for 2012.

Individual 401(k)

Small business employing only the owner, a spouse or business partner may choose the Individual 401(k). This type of plan offers a percentage-based contribution similar to a SEP plan, but with the ability to make pre-tax or Roth after-tax salary deferrals, as well. Between your salary deferrals and business contributions, a maximum of $49,000 can be contributed for 2011 ($54,500 if over age 50) and a maximum of $50,000 can be contributed for 2012 ($55,500 if over age 50). Unlike a SEP or SIMPLE IRA, the Individual 401(k) also gives you the potential to access your plan assets through a loan.

For more information about other available retirement plans, including a 401(k), please see our Employer-sponsored Retirement Plans.
 

For more information on our small business retirement plans, please visit Hartford Investor. 
 

Current tax planning strategies emphasize the deferral of current income taxes, on the basis that your federal income tax rate may be lower at retirement. As you decide how much to defer, please keep in mind that federal income tax rates are unpredictable and subject to significant fluctuation. It is possible that federal income tax rates at the time you take a distribution (e.g., at retirement) may be higher than tax rates at the time of deferral. Other factors, including any other sources of income and state income tax rates, may also change the tax bracket and overall tax rate to which you may be subject in the future. Please consult with your tax advisor for an individualized tax planning strategy and advice. The Hartford does not predict or in any way guarantee favorable tax results.

This information is written in connection with the promotion or marketing of the matter(s) addressed in this material. The information cannot be used or relied upon for the purpose of avoiding IRS penalties. These materials are not intended to provide tax, accounting or legal advice. As with all matters of a tax or legal nature, you should consult your own tax or legal counsel for advice.
 

The Hartford recognizes the importance of cost- and time-saving services for the small business owner. Our small business retirement plan solutions are designed to help make your plan easy to establish and administer, so that you can maintain your focus on your business. We offer:

• Employer guides that provide comprehensive information to assist with plan set-up.
• Employee guides that can help educate your workers about the retirement plan you’re providing them.
• Investment options that provide access to a wide variety of asset classes and investment objectives, allowing you and your financial advisor to create a personalized portfolio to help meet your needs and goals.
• On-line account options, which help make it easier to direct contributions and help simplify any needed plan changes.
• Product pricing options that minimize cost, allowing for more tax-deferred growth potential.

There are a number of factors to consider when establishing a retirement plan.   The employer should consult with a qualified advisor to ensure a proper plan is established.

At The Hartford, we help small business owners pursue a financially secure future by anticipating their needs and providing relevant products and services. We are committed to understanding and addressing the financial issues small business owners face when developing long-term investment strategies.

We offer:

• Cost-efficient plan solutions for small and micro-businesses
• A wide variety of investment options
• Innovative income product solutions
• The ability to help meet a multitude of business needs working with one company