An Open MEP is a fantastic tool for today’s business owner. Because the benefits impact the company’s bottom line, they’re also a win-win for both employers and employees.
Here are several reasons why an MEP may be an appealing option for your business…
What if there was a better alternative to traditional 401(k)s? When the average American thinks of how to prepare for retirement, a few financial options come to our minds. 401(k)s and IRAs have been at the forefront of the retirement industry since the late seventies/early eighties, but they were not the first (nor are they always the best) options when it comes to planning for your (or your employees’) retirement. Let us introduce you to the Open MEP.
In the same way that the “cloud” has been able to free up technology access for the small business owners, a new breed of retirement plans is available to address the human resource side of business. That new plan is a Multiple Employer Plan (MEP). It is also known as the MEP.
When the 401(k) system started, there were no assets in the funds. Retail mutual funds were the only investment vehicles available to take small contributions. Now, however, things have dramatically changed. The 401(k) system is vast and ever-expanding, holding upwards of $7 Trillion in employees life savings. Those kinds of assets demand an institutional, and not just a retail, set of investment choices.
For those who are not aware, revenue sharing is the idea of transferring fees from investment companies to service providers who support 401k plans. Instead of charging their fees directly, they receive them without the sponsor and participants sometimes ever knowing.
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