Christine D. Chaia, director of corporate marketing for Hartford Life Insurance Co . , says her company is increasingly called upon to set up retirement plans for small companies. A big concern put forth by many potential customers is the cost of providing this benefit. Chaia insists that shouldn't be a big problem. Richard L. Sorrell, director of pension services for Rea and Associates, certified public accountants based in New Philadelphia, Ohio, administers 65 retirement programs. While both of these plans require employer contributions, Sorrell says they aren't as expensive as they might seem at first blush.
Funding comes from employees voluntarily deferring salary.
There's no match for those who don't want to be in the plan. Or the employer can choose to contribute 2 percent of the salary of all eligible employees whether they want to be in the plan or not. The employer gets some flexibility in deciding who's eligible to participate and who's not. Part-time employees and those younger than 21, or anyone with less than one year's service, can be excluded. Advantages Sorrell likes these plans for a variety of reasons, including the ease of management.