Small employers have a tough time affording 401(k) plans, that’s a fact. 401(k) plans aren’t cheap and most of the savings touted by multiple employer plans aren’t there. So many companies and governments are offering SEP-IRA or other IRA programs (SIMPLEs) to get employees covered if the workplace doesn’t have a retirement plan.

The problem with SEPs is that there is no deferral and SIMPLE IRAs have lower deferral amounts. Also, employer contributions must be uniform (no new comparability). Also, many of these IRA programs don’t offer a financial advisor to offer guidance.

I prefer that an employer offer a 401(k) plan and based on the compliance and filing requirements, there are reasons to keep it SIMPLE (pun intended). You should only have a retirement plan that you can afford, so you might have to deal with an IRA program until you can foot the bill of something better.