Retirement Readiness for Business Owners and Employees: 401(k) Automatic Enrollment
By BuildMyBiz on October 26th, 2012
Automatic enrollment is an optional feature of 401(k) retirement plans that enables businesses to enroll employees in the company’s retirement plan as soon as they become eligible. Employees may opt out of participation within a specified deadline without incurring a penalty, but statistics show that most remain.
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Benefits for employees include a potentially larger nest egg for retirement through pretax deferrals and possible employer matching contributions. Potential benefits for employers include the ability of business owners and highly paid employees to make higher 401(k) contributions and the lowering of per-employee costs for plan administration.
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