Set up a SIMPLE IRA plan

ARTICLE TAKEAWAYS

  • Find the paperwork needed to set up a SIMPLE IRA plan
  • Learn how to enroll eligible employees
  • Understand how contributions are submitted

Follow these step-by-step instructions to set up a SIMPLE IRA plan.

Step 1: Set up the plan

Have the plan sponsor:
 
  1. Complete the SIMPLE IRA Adoption Agreement and the Online Group Investments (OGI) Contributions Agreement located in the SIMPLE IRA Plan Sponsor Guide
    Note: Contact us for information about using an adoption agreement other than the one in the SIMPLE IRA Plan Sponsor Guide.
  2. Keep a copy of the Adoption Agreement for their records
  3. Return the completed forms to Capital Group. Copies are acceptable.
     

Plan effective date: The effective date indicated on the Adoption Agreement must be between January 1 and October 1 and must be during the 60-day enrollment period. All subsequent plan years begin on January 1.

Step 2: Notify eligible employees

Once the plan is established, have the plan sponsor distribute the following to all eligible employees:

  1. SIMPLE IRA Employee Guide (which includes the SIMPLE IRA Application)
  2. The following documents located in the SIMPLE IRA Plan Sponsor Guide:
    a.  Notification to Eligible Employees*
    b.  Summary Description*
    c.  Salary Deferral Election form
     

* The plan sponsor must complete these before distributing.

Enrollment period: Employees must be allowed to enroll for 60 days after they are notified of the plan.

Step 3: Schedule an enrollment meeting

  1. Consider using the SIMPLE IRA enrollment video during the meeting. This video can help employees understand the benefits of the plan and why they should participate. 
  2. Provide prospectuses for all of the plan’s investment options
     

Step 4: Enroll employees

  1. Collect the completed SIMPLE IRA Applications (found in the SIMPLE IRA Employee Guide) and return them to Capital Group. If the setup fee is not included, $10 will be deducted from each participant’s account.
  2. Collect the completed Salary Deferral Election forms and return them to the plan sponsor. Do not return these to Capital Group.
     

Step 5: Submit contributions online

Participant contributions must be submitted online though the Online Group Investments (OGI) website. The designated plan contact (and third-party remitter, if applicable) will be sent an email providing them with a link to the website, the user ID and instructions for getting started.

For additional information on contributions, deadlines and more, visit SIMPLE IRA contributions.

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Related content

SIMPLE IRA contributions

Opening SIMPLE IRAs

IRA beneficiary designations

 

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Contact us 8:00 a.m. to 7:00 p.m. ET, Monday through Friday.

(800) 421-0180

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The guidelines and procedures provided in the Account Resource Center may not apply to networked accounts or accounts not directly held by American Funds. The guidelines and procedures provided also apply only to those retirement accounts or Coverdell ESAs invested in American Funds with Capital Bank and Trust Company (CB&T) as custodian. The guidelines and procedures provided in the Account Resource Center do not apply to plans held in our retirement plan solutions — PlanPremier, PlanPremier-TPA or RecordkeeperDirect. Information on the Account Resource Center may change periodically, and previously printed information may not be current. Please refer to capitalgroup.com for the most current information available.

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