This course covers the types, characteristics, advantages, and disadvantages of 401(k) retirement plans available to U.S. businesses and self-employed individuals. Included in this course are explanations of the following types of 401(k) plans: traditional 401(k) profit sharing plans, 401(k) Keogh profit sharing plans, 401(k) stock ownership plans, Roth 401(k) plans, SIMPLE 401(k) plans, and safe harbor 401(k) plans.

5–1 Describe the basic characteristics of a 401(k) plan.
5–2 Describe the basic characteristics of profit sharing and stock bonus 401(k) plans.
5–3 Describe the basic characteristics of the SIMPLE 401(k) plan and how it compares to the regular profit sharing 401(k) plan.
5–4 Describe the factors that employers should consider when determining if a 401(k) plan would be appropriate.
5–5 Analyze a situation to identify the advantages and disadvantages of a profit sharing 401(k) plan and a SIMPLE plan.
5–6 Describe the basic characteristics of the safe harbor 401(k) plan.

Author: Michael B. Cates, MS, CFP®

Michael B. Cates, MS CFP® joined the College in 1986, and is the professor for the Income Tax Planning course of the CFP Certification Professional Education Program.  He received his CFP® certification in 1995, and completed the College's Master of Science degree program in 1997.  Mike is also the lead professor for the introductory Income Tax Planning cours ein the College's master's program.  In addition to his responsiblities at the College, Mike also maintains a tax planning and preparation firm in Aurora, Colorado.  You can reach Mike at

Complexity Level: Intermediate