According to The Small Business Administration over 46% of private sector workers in the US are employed by small businesses [1] and 57 million workers are not covered by employer-sponsored retirement plans. In her second act career as a venture-backed entrepreneur, Jean Smart is bringing simplified 401K solutions to small business owners to offer their employees.

Jean Kim Smart joins us from New York.

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Jean Smart was the managing director, head of business strategy, corporate and institutional advisory solutions at UBS in 2020, and had spent her 20+ year career as a Wall Street executive. Then, at the height of the COVID-19 pandemic, she observed millions of small businesses around the country struggle, reminding her of how her immigrant parents—owners of a grocery store and restaurant in Los Angeles—cared for their family and employees but failed to invest in their own retirement, leaving them vulnerable in old age.

Jean was inspired to move on from her steady financial services career and begin her second act. She founded Penelope, a venture-backed 401(k) platform focused on micro and small businesses. There are over 5 million micro businesses (less than 50 employees) across the U.S., and Jean recognizes the untapped potential of helping these entrepreneurs support and retain their employees with a best-in-class retirement program that’s simple, affordable, and effective to use in solving the retirement crisis facing the 57 million U.S. workers without a company-sponsored retirement plan.

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For More on Jean Kim Smart 

Penelope 401(k)

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Related Article:

‘You have an obligation.’ Employers need to step up to help workers prepare for retirement.

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Wise Quotes

On Mentors for a Second Act

“Mentors play all the roles. They inspire you. They give you very tactical, real advice. And I would say, as a fan base, my parents have been my mentors from birth. It’s part of the reason why you have self-esteem or some level of confidence, no matter how many times you get knocked down. I think my parents have been sort of pillars of that all the way through… So I’ve been fortunate. One part of being in the second act, your network is significantly larger. So when you start talking to people, everyone’s thought about this, doing a second act, a third act, or starting a business. And once you start talking to people and sharing your ideas, they come out of the woodwork. They’re really willing to share and introduce you to other folks. So it started off small and then it snowballed pretty quickly in terms of meeting other folks and asking them questions about their experience.”

On Retirement Plans for Small Businesses

“Believe it or not, nearly 5 million businesses still do not have a retirement savings program – and that equates to the 57 million Americans I mentioned earlier. There’s a whole confluence of events and needs, whether it’s education, availability, accessibility costs or a lack of information. I would say we’re entering a new era of opportunity. I always think of this as the carrot and the stick measure components. You’ve got both factors. So at the sort of carrot level, the federal government via Secure 1.0 and Secure 2.o,  two major pieces of legislation that have byproducts and support and that have passed, are providing unprecedented tax incentives for small businesses to get set up. If you’ve never set up a plan to start a plan, if you’ve got under 50 employees,  there’s a slew of tax credits. And I encourage any small business owner or individual to talk to their tax advisor and accountant to see what those are. You can easily Google some of those resources. There are a lot of shortcuts, a lot of incentives that have never existed before. Then you’ve got the stick component. 16 states have already passed legislation requiring a small business to have a qualified savings plan. There are many options. There are some state options, many choices and great providers, but I believe there’s never been a better time – whether you go with the traditional firm or some of the newer firms. Modern 401K providers  make it really easy and take away a lot of the administrative burden, a lot of the decision making around investments as well as making the cost extremely favorable for businesses and their employees. So, there’s never been a better time.”

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About Retirement Wisdom

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About Your Podcast Host 

Joe Casey is an executive coach who also helps people design their next life after their primary career. He created his own next chapter after a twenty-six-year career at Merrill Lynch, where he was Senior Vice President and Head of HR for Global Markets & Investment Banking. Today, in addition to his work with clients, Joe hosts The Retirement Wisdom Podcast, which thanks to his guests and loyal listeners, ranks in the top 1.5 % globally in popularity by Listen Notes. Business Insider has recognized him as one of 23 innovative coaches who are making a difference. He’s the author of Win the Retirement Game: How to Outsmart the 9 Forces Trying to Steal Your Joy.

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[1] Frequently Asked Questions About Small Business 2023