Is a SIMPLE IRA a good fit if I have a few employees?

A SIMPLE IRA is designed for small businesses with 100 or fewer employees and is cheaper and easier to run than a full 401(k). Employees can defer part of their pay up to the SIMPLE limit the IRS sets annually, and you as the employer must either match contributions dollar-for-dollar up to 3% of pay or make a flat 2% contribution for everyone. The trade-off is lower contribution limits than a 401(k) or SEP, and stiff early-withdrawal penalties in the first two years. It works well when you want to offer staff a retirement benefit without heavy administration but don't need to shelter huge amounts yourself. See irs.gov Publication 4334 for the current-year limits.