SIMPLE vs. Traditional 401(k)
Which is best for your business?

SIMPLE IRA

SIMPLE 401(k)

Standard 401(k)

Maximum Business Size

100 or fewer employees

100 or fewer employees

No limit

Individual Contribution Limit

$10,500 in 2007

$10,500 in 2007

$15,500 in 2007

Discrimination Testing

No

Limited

Yes

Mandatory Employer Match

Yes, 1%-3% of salary for match or 2% for all

Yes, 3% of salary for match or 2% for all

No, unless safe harbor election

Vesting

Immediate

Immediate

Up to 6 years for match; up to 7 years for profit sharing

Administration

Least

Medium

Most