More than half of small businesses may not have optimal retirement plans, according to a new survey.

The survey, by Fidelity Investments, found that 53 percent of small businesses may not have the retirement plan that best fits their needs. In addition, many small business owners are struggling to understand the features and benefits of their current retirement plans. Fidelity has introduced a calculator to help small business owners determine an optimal plan and contribution rate.

The survey of more than 500 small business owners gauged their understanding of SEP-IRAs, SIMPLE-IRAs and Self-Employed 401(k) plans. The results highlight the education gap that many small business owners face with their current plans. When asked a series of basic questions about their retirement plan features and benefits, respondents on average answered just 66 percent correctly.

For example, half of the survey respondents who use a Self-Employed 401(k) did not know the maximum annual employer contribution allowed for this plan. Nearly two-thirds (60 percent) with SIMPLE-IRAs were not aware that employer tax filing is not required. More than half (55 percent) using a SEP-IRA did not know that the plan is funded solely by employer contributions.

Fidelity is advising small businesses to reassess their retirement plans during tax season. “With the April tax filing deadline just around the corner, now is an ideal time for small business owners to reassess their retirement plans and determine if they meet their needs,” said Fidelity Investments vice president Ken Hevert in a statement.

Fidelity also surveyed 100 small business owners who do not have a retirement savings plan at all. The top reason cited, by 34 percent of them, for not having a retirement plan is the perception that it is too expensive.

To help small business owners, especially those with 10 or fewer employees, Fidelity has published a Viewpoints article that outlines the costs, contribution limits and other critical features and benefits of four types of retirement plans that small business owners should consider.

In addition, to help small business owners decide what percentage they should consider contributing to a SEP-IRA or Self-Employed 401(k) Plan, Fidelity has introduced a Self Employed Plan Contribution Calculator. After answering five simple questions, small business owners can adjust their contribution percentages to model various scenarios and compare plans.

Fidelity noted that a SEP-IRA is the only plan that can still be established and funded for tax year 2011, up until the April 17, 2012 deadline.

To access the calculator the Viewpoints advice and other resources, visit

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