What Is a SIMPLE IRA and How Can It Help My Small Business?

If you're a small business owner looking to offer retirement benefits without getting buried in red tape or huge costs—a SIMPLE IRA might be your new favorite acronym.

Key Takeaway: A SIMPLE IRA is an affordable, easy-to-manage retirement plan that lets small businesses support their employees’ futures—while getting valuable tax benefits too.
image

So, What’s a SIMPLE IRA… in Plain English?

SIMPLE stands for Savings Incentive Match Plan for Employees. (We know, it’s a mouthful.)

Translation? It’s a retirement savings plan designed specifically for small businesses with 100 or fewer employees.

Here’s why business owners love it:

  • It’s way easier to set up than a 401(k)

  • It’s way cheaper to maintain than other plans

  • It helps you attract and retain great employees

It’s basically the Goldilocks of retirement plans: not too complicated, not too expensive—just right.

Why Offer a SIMPLE IRA?

1. It’s Simple. Really.

No crazy admin. No annual IRS filings. It’s easy to understand and even easier to explain to your team.

2. Your Employees Save for the Future

Employees can contribute directly from their paychecks—just like a 401(k). And those contributions grow tax-deferred.

Plus, you can choose to:

  • Match up to 3% of their pay

  • OR contribute 2% to everyone, even if they don’t chip in

Either way, you’re helping them build a future—and they’ll appreciate it.

3. You Get Tax Benefits Too

Contributions you make as an employer are tax-deductible. And helping your employees prepare for retirement? That’s just good business.

Who’s a Good Fit for a SIMPLE IRA?

This plan is great for:

  • Small business owners with fewer than 100 employees

  • Startups looking for affordable benefits

  • Employers who want to reward loyalty without a 401(k) price tag

  • Anyone who values simplicity and flexibility

People Also Asked:

How is a SIMPLE IRA different from a 401(k)?

  • SIMPLE IRA: Lower costs, easier setup, fewer rules

  • 401(k): More complex, but allows higher contributions and optional Roth features

If you want easy and affordable, SIMPLE wins. If you want more bells and whistles, a 401(k) might be better.

How much can employees contribute to a SIMPLE IRA in 2025?

In 2025, employees can contribute up to $17,000, plus a $3,500 catch-up if they’re 50 or older.

Can I have a SIMPLE IRA if I’m self-employed?

Yes! If you’re a sole proprietor or have a small team, you can set one up for yourself—and get the same tax and retirement benefits.

Let’s Set You Up for Success

You take care of your business every day—let’s make sure your retirement plan is working just as hard.

? Contact Gruene Insurance Group and let’s chat about setting up a SIMPLE IRA that works for you and your team. It’s one of the easiest, most impactful decisions you’ll make this year.

Featured Blogs