September 25, 2010
In an article, "Profit Sharing Boosts Nest Egg," partner Richard S. Chargar discussed whether safe harbor plans are appropriate for businesses such as law firms and medical practices.
The reporter noted that discrimination testing reduces how much highly compensated individuals can contribute to their 401(k)s and that safe harbor plans eliminate those barriers.
"The real question you want to answer is how much you, the owner, want to spend to maximize your contribution, Chargar said. Depending on the composition of your work force, a safe harbor can be expensive because of mandatory employer contributions, he said. Or it can be the only way to go if participants don't contribute enough for the owner to maximize his or her retirement savings."
The article was published in the Connecticut Post, Greenwich Time and News Times.