Outgrowing Your SIMPLE or SEP IRA? Let’s Talk.

It Sounded so easy in the Beginning

You probably set up a SIMPLE or SEP IRA because it was easy. Your CPA recommended it, or your payroll provider offered to “take care of it.” And to be fair, it worked—for a while.

But if you’re here now, something’s changed.

Maybe you’ve hired more employees.
Maybe you’re hitting contribution limits.
Maybe you’re realizing that “low maintenance” actually means “zero strategy.”

These plans aren’t bad—they’re just not built for what your business might be becoming.

Here’s When It Might Be Time to Move On

You’ve got employees, not just contractors.
A SEP requires equal percentages for everyone, and SIMPLE plans come with mandatory matching. That gets expensive fast—and limits flexibility.

You want to put away more than the IRS lets you.
SIMPLE IRAs have lower contribution limits than 401(k)s. And with a SEP, you’re capped as a percentage of income. A 401(k) opens the door to higher savings, especially with profit sharing or a cash balance plan.

Your team is asking for more.
Things like Roth contributions, loans, or a legit retirement benefit. SIMPLE and SEP IRAs don’t offer those options, and eventually, that becomes a retention problem.

The 401(k) Alternative

I help small business owners transition from SEP or SIMPLE IRAs into 401(k) plans that actually make sense for their size, goals, and budget. No fluff. No overpriced admin packages. No “just trust us” from bundled providers.

Some clients stick with what they’ve got after we talk. Others realize they’ve outgrown it and make a change. Either way, you’ll walk away with clarity—and maybe a little validation that your gut was right.

Resources:

SEPs – from IRS.Gov

SIMPLE Plans – From IRS.gov

How to Upgrade your SIMPLE to a 401(k)

Want a Straight Answer About Your Plan?

No hard sell. Just a real conversation.