When you’re first establishing yourself as an independent adult, taking on extra work (side hustles) can make a huge difference in paying off debt and starting your investment journey.
Often, your day job salary will grow fast enough that maintaining side hustles isn’t always necessary.
However, sometimes, your side hustle income grows so fast that transitioning to self-employment or entrepreneurship makes sense.
But before you make the transition, you have to consider how you’re going to cover everything from health and disability insurance to your 401(k) plan. Once you start adding employees to the mix, the decisions become even more important (and complex).
Offering a 401(k) plan can be a valuable saving and recruiting tool. In addition to providing financial security in retirement, 401(k) plans provide tax advantages for both the business owner and their employees, including tax deductions, tax-deferred earnings, and tax credits. All of these can add up – and save you money.
If you’ve started a small business (even a sole proprietorship), it might be time for you to check out Ubiquity, which is a company that specializes in low-cost 401(k) management. They make it cheap and easy for sole proprietors and small business owners to set up 401(k) accounts for themselves and their employees.
Is Ubiquity the right company to help with your company’s retirement needs? This review will help you decide.
- Solo 401k and Small Business 401k Plans
- Easy to use, flat-fee 401k plans
- Large selection of investment options to match your needs
Solo 401k and SMB 401k Plans
Solo 401k Pricing
SMB 401k Pricing
Starts at $90/mo
What Services Does Ubiquity Offer?
Ubiquity is a 401(k) plan manager for sole proprietors (including 2 person spouse-owned companies) — and small businesses with up to 100 employees. They empower business owners to offer a 401(k) benefit for themselves and their employees.
Ubiquity gives owners the option to choose from 33,000+ mutual fund options. Business owners can also choose from preselected options.
Ubiquity gives you a choice of investment flexibility as well as 3(38) fiduciary coverage (which is the option for a professional to oversee your account), depending on your financial goals. In addition to building plans, Ubiquity can help business owners optimize their plans for tax efficiency (including creating “safe harbor” and Roth 401(k) plans).
Single(k) - The Solo 401k
The Single(k) is Ubiquity's solo 401k plan. As you know, we're huge fans of the solo 401k. Ubiquity offers an easy-to-setup and easy-to-use Solo 401k plan. Their plans also easy connect to several major payroll providers (including Gusto) to make funding them easy.
Their solo 401k plan offers a lot of features - with pre-tax, Roth, AND after-tax options. This does enable the mega backdoor Roth IRA. They also offer loans. As for investments, you can invest at the brokerage firm of your choice (as long as they support the plan documents), and you get checkbook control, so you can invest in alternatives.
Small Business 401k
Ubiquity is one of the best (and lowest cost) option for small business owners to start a 401k. These are plans for businesses with over 2 employees who aren't spouse owners. They offer several levels:
- Saver(k) - Most affordable option with set plans
- Custom(k) - Offers customization, including employee vesting
- Reserve(k) - Designed for large plans, includes a custom support team and ERISA fidelity bond coverage
What Fees Does Ubiquity Charge?
Ubiquity charges a flat monthly fee (they do not charge a percentage fees based on the amount of money in the account, as some 401(k) plan providers do).
Think of Ubiquity as your retirement concierge. The company provides electronic participant statements; tax filing and plan document preparation; participant disclosures; annual plan notifications; IRS testing and monitoring; and eligibility notices.
All of this may sound complicated, but you do not need to understand all the details. Ubiquity provides educational resources to help!
Single(k) Solo 401k - Plans start at $18 per month, with a one-time $285 setup fee.
Saver(k) 401k - Plans start at $75 per month
Express(k) 401k - Plans start at $15 per month
Custom(k) 401k - Plans start at $165 per month
Reserve(k) 401k - Custom quotes only for this plan.
Note: There may be a setup fee of $495 for the full service small business 401k plans.
It's important to note that Ubiquity offers a custom plan, where as the free plans available from the major brokerages are typically limited in what they offer.
Do I Need to Offer My Employees a 401(k)?
If you’re a sole proprietor, and you don’t plan to hire full-time employees in the near future, setting up a 401(k) through Ubiquity might be overkill. It makes a lot more sense to spend 30 minutes setting up an individual 401(k) at a brokerage company like E*TRADE.
Small business owners with just a few employees don’t necessarily have to offer 401(k) plans to their employees, but it can be a huge benefit. In particular, if your employees are high earners (say you own an accounting firm or a consulting business), they’ll probably prioritize access to a retirement plan. In cases like that, it will serve you and your employees to start offering a 401(k) plan.
However, the tax benefits to you as an owner are real. Moreover, recent legislation called the SECURE Act (passed in 2020), means your business could qualify to earn up to $16,500 in tax credits over a 3 year period by starting a qualified retirement plan with auto-enrollment.
How Does Ubiquity Compare?
For small business 401k plans, Ubiquity offers one of the most flexible and lowest-cost 401(k) plans in the market. What makes it unique is that they do not charge for assets under management. This makes it really tough to compare exact costs. Other low-cost providers such as Betterment for Business or Employee Fiduciary may lower monthly costs, but their business models are different.
Also, if you have a Solo 401k, Ubiquity offers checkbook access, which allows you to invest in real estate, precious metals, or cryptocurrency.
Here's how they compare specifically with Solo 401ks:
IRA & 401k
IRA & 401k
Final Take on Ubiquity 401(k) Plans
Any retirement plan can help build a more secure financial future. 401(k) plans are the second most requested benefit (behind health insurance) for small business employees. A plan can help you attract and retain top performing employees, reap tax benefits and lower taxable income–and it doesn’t have to cost a lot of money.
Be sure to research and make an informed decision about how you can best provide for your retirement needs and those of your employees.
If you’re an entrepreneur with employees, you should consider providing a 401(k) plan for them. This can help you retain great employees, and it doesn’t have to cost a ton of money. Ubiquity can help you provide a meaningful benefit to your employees.
However, it is important to collect at least two or three quotes from 401(k) providers before deciding which one makes the most sense for your business. Ubiquity deserves to be on your short list of low-cost 401(k) plan providers, but it’s not the only provider.
Do some research and make an informed decision about how you can best provide for the retirement needs of your employees.
- Pricing and Fees
- Products and Services
- Customer Service
- Investment Options
Ubiquity offers 401(k) plans for both small businesses and sole proprietors (i.e. a Solo 401k).
- Create custom 401k plans for your business
- Flexible investment options, including checkbook control for Solo 401k Plans
- Integration with major payroll providers
- Price is slightly higher for Solo 401k compared to other plans
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.