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Introduction

Small business owners have to consider a lot when setting up their company. Everything from what the product will be to the team they will hire to the name they will choose for their business. However, one thing that many small business owners overlook is how to incentivize their employees to stay with the company. A 401k plan is an excellent way to provide incentives while also offering benefits to small businesses that employ less than 10 employees.

What is a 401k?

A 401k is an employer-sponsored retirement savings plan that employees can invest in. This plan allows employees to save for retirement while deferring income taxes on their contributions. Employers have the option to match a certain amount of money to the employee's contribution, which is essentially “free money” for the employee.

Benefits for Businesses

Small businesses that employ less than 10 employees can benefit from having a 401k plan in place. By offering an attractive retirement savings plan, employers will be able to attract and retain talented employees, particularly from younger generations who are already accustom to saving for retirement. In addition, it will also make the business much more attractive for potential hires.

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