Different kinds of employer matches

1.      Basic Safe Harbor Match:

In this match, the employer contributes based on employee deferrals. The employer matches 100% of employee contributions up to the first 3% of their compensation that they defer into the plan. Additionally, the employer matches 50% of contributions on the next 2% of the employee's compensation that they defer into the plan. This match structure ensures that employees receive a generous match on their contributions.

2.      Enhanced Safe Harbor Match:

Plan sponsors can choose between 3 options for the enhanced match. These options provide flexibility for employers to tailor the match to their specific preferences and benefit their employees accordingly.

• The employer matches 100% of employee contributions on the first 4% of their compensation deferred into the plan.
• The employer matches 100% of employee contributions on the first 5% of their compensation deferred into the plan.
• The employer matches 100% of employee contributions on the first 6% of their compensation deferred into the plan.

3.      Discretionary Matching Contribution:

This match allows the employer to decide the percentage of employee deferrals to match. It provides flexibility, giving the employer the ability to adjust matching amounts as business needs change. For example, a company may offer a 25% match of employee deferrals up to 5% of their compensation. This match structure allows employers to align their match with their current financial situation while still providing a valuable benefit to employees.