What is the Craters & Freighters QACA Safe Harbor match feature for the 401(k) plan?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
Effective January 1, 2025, the Company established a 401(k) Retirement Plan (Plan) to replace the SIMPLE IRA plan. The Plan offers pre-tax and Roth contribution options for its participants. The Plan has a QACA Safe Harbor match feature equal to 100% of the first 1% of the participants' compensation plus 50% of the next 5% of the participants' compensation.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 49)
What This Means (2025 FDD)
According to the 2025 FDD, Craters & Freighters established a 401(k) Retirement Plan effective January 1, 2025, replacing the SIMPLE IRA plan. This plan includes pre-tax and Roth contribution options for participants. A key feature of the plan is the QACA (Qualified Automatic Contribution Arrangement) Safe Harbor match.
The QACA Safe Harbor match means that Craters & Freighters will match 100% of the first 1% of a participant's compensation. Additionally, they will match 50% of the next 5% of the participant's compensation.
For a prospective franchisee, this is a valuable benefit to consider. It means that if an employee contributes 6% of their compensation to the 401(k) plan, Craters & Freighters will contribute a total of 3.5% of the employee's compensation (1% + 2.5%). This matching contribution can significantly boost an employee's retirement savings. Franchisees should ensure they understand the details of the 401(k) plan and communicate these benefits effectively to attract and retain employees.