A Rollover for Business Startups (ROBS) is a funding solution that allows you obtain a business with your retirement savings without paying premature withdrawal fees or tax penalties. These transactions can be difficult and confusing, which is why we recommend using an experienced supplier. We compare the ideal ROBS providers below.
Best ROBS Provider: Guidant Financial
Guidant Financial topped the list because they complete more ROBS trades annually than any other supplier and they’re the only ROBS supplier that offers free outside counsel to you before, during, and following your ROBS transaction is complete. It takes about 2-3 weeks to get funded and the entire process begins with a totally free consultation.
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Top 5 ROBS Providers 2018
| ROBS Provider | Best For |
|---|---|
| Guidant | (Best Overall) Startups that want a seasoned provider with the highest level of service at a Fantastic cost. |
| FranFund | entrepreneurs looking to fund a company together with ROBS or ROBS + SBA. |
| Benetrends | Startups looking for the provider that’s been successfully doing ROBS the greatest. |
| MySolo401k | Startups Searching for the Cheapest ROBS alternative available. |
| Catchfire Funding | Entrepreneurs who do not need to proceed with one of the four primary options over. |
We Determined Which ROBS Provider is your Ideal
Rollover for Business Startup (ROBS) providers typically help you set up a ROBS, which is confusing. While all suppliers can help you through the trade, the best ROBS providers differentiate themselves through their experience and service. For instance, because a ROBS is complicated, many promise help in the event of an audit.
The criteria we use to determine the best ROBS supplier comprises:
- Installation costs
- Ongoing fees
- Support provided before and after the transaction
- Just how easy it is to speak with the supplier
- Previous success with ROBS
- What extra funding is offered by the supplier
When looking at each one these variables, we were able to find many excellent ROBS providers seasoned enough to successfully help you through the transaction. In an industry where most suppliers have similar offerings, Guidant stood out due to this degree of service they offer their customers.
As an example, with a ROBS, attempting to determine if it’s ideal for you can be just as difficult as the actual transaction process itself. Guidant is the only supplier that provides you the opportunity to speak to an outside lawyer who’s experienced with ROBS trades before you enroll. The best part is it will not cost you anything.
Guidant also gives their clients more assurances during a possible audit compared to any other provider. At no extra cost to you, they will provide you with outside counsel to help you get through the audit process. Dealing with Guidant on a ROBS trade costs $4,995 to set up and a continuing fee of $139 a month. Your company can receive funds in as little as fourteen days.
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Best Overall ROBS Supplier: Guidant
Guidant is the ideal match for most entrepreneurs looking for a ROBS provider because they finish more ROBS trades annually than any other supplier, and offer more upfront support. By way of instance, they’re the only ROBS supplier that delivers a totally free outside counselor consultation before you sign up. Plus their costs are competitive with the other leading ROBS providers.
What Guidant Offers
More than 1,600 small business owners use Guidant annually to finish a ROBS trade, and they have never needed one disqualified through an audit. They offer competitive pricing and are experienced with businesses, with about 60 percent of their clients owning a franchise. Approximately 0.32percent of their ROBS plans get audited every year, which will be marginally lower than other providers.
Ongoing Support
Guidant is the only ROBS supplier that offers free outside counselor for you before, during, and following your ROBS transaction is complete. For instance, every possible Guidant customer receives two 1-hour sessions with an outside lawyer to evaluate whether or not a ROBS is the right financing option.
Guidant also guarantees in their contract that they will pay for outside counsel to assist you through any audit of your ROBS retirement plan. Other providers say they will provide this degree of support, but only Guidant guarantees it within their contract.
When and if you eventually sell your company, Guidant helps ensure the retirement plan is closed down and rolled in an IRA account. They make certain all of the proper paperwork is finalized, and document your last IRS Form 5500 for the year that your company is sold. Ordinarily, Guidant will charge you their monthly fee for a few months after the sale of your business so they can finish up these jobs on your behalf.
Additional Funding Launched
In addition to ROBS, Guidant helps their customers get funding for SBA loans, unsecured loans, portfolio loans, and equipment leasing. For this support, you pay Guidant a $2,500 consulting fee to begin working on your loan request.
They will direct you through the application process and present you to lenders they have partnerships with. If you don’t get financed with Guidant’s aid, they’ll refund the $2,500 fee. However, should you decline a potential loan as you don’t like the terms they will continue to keep the fee. Guidant also collects a fee from several of their lender partners, but it doesn’t impact your overall loan costs.
Guidant Costs
Guidant has two main prices with a ROBS transaction:
- Setup Fee: $4,995
- Ongoing Maintenance Fee: $139 per month for up to 10 employees, $3.33 per employee per month after 10per cent
Guidant costs a little bit more than some of the alternatives on the list but we think it’s justified on account of the external counsel given by the cost of Guidant. The excess cost, compared to other providers, is quite minimal and could be as little as $9 per month.
What Guidant is Missing
Guidant is a superb option to help you through the ROBS trade, but they do charge a tiny bit more than the competition. They are also not as incorporated to the franchise community as a number of their opponents, in which ROBS are very common. To learn more, you can read our review of Guidant Financial.
How to Apply With Guidant Financial
With Guidant, you can get funded with a ROBS within 2-3 weeks. The entire process starts with a free consultation where you can ask all your questions and discover out if it’s the ROBS is ideal for you. Guidant then gives you two 1-hour sessions, free of charge, with an outside counsel to decide if your personal situation merits a ROBS.
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Best ROBS Provider For Franchises: FranFund
FranFund is the ideal fit for businesses searching for a ROBS arrangement because they are more ingrained into the franchise community than their rivals. Around 97 percent of their clients in 2017 were franchises, and their CEO sits on the provider board of directors for the International Franchise Association.
The creators of FranFund are even past franchise executives and executives, so they plan to construct a financial partner that understands the trials that franchises undergo. Their combined experience and knowledge of the franchise business and ROBS transactions makes them the best companion for franchise owners.
What FranFund Offers
FranFund’s ROBS offering is similar to Guidant’s, but FranFund focuses primarily on franchise companies. They also offer lower overall costs and tons of ongoing support. For example, before you enroll, they possess a unique program called”The Safety Net Program” which makes it possible to shorten the time necessary to experience the ROBS process, at no cost to you.
This program does is guide you through the process of moving your funds in an IRA account before you initiate the ROBS so you can get financed faster. Normally, you’d have to wait for your funds to move from your 401k accounts, which requires considerably longer. Having the money in a tax deferred IRA accounts is what allows you to have funded in as little as 2 weeks.
Ongoing Support
FranFund offers plenty of ongoing support once you fill out the ROBS trade, including the promise of outside counsel during an audit. While they do not explicitly summarize this in their arrangement they do promise verbally that they’ll provide you with outside counsel at no extra cost to you, whether it’s needed.
FranFund will also do all the legwork and help you sign up qualified employees to your 401k plan. They’ll prepare and file your annual 5500 types, and they will work with you every step along the way to be certain that you have your questions answered as they come up. Their continuing support level resembles Guidant’s, except that Guidant actually has audit aid outlined in their contract.
Additional Financing Offered
FranFund makes it possible to select the right financing option for the franchise, such as SBA loans, unsecured business loans, equipment financing, and securities backed financing. They will package any potential loan request and submit it to creditors for your benefit. Lenders are hand-picked by FranFund to increase the likelihood of obtaining your loan funded. They receive a fee once you close a loan, but it should not affect your complete loan costs.
FranFund also provides direct financing options through FastForward Capital. They provide traditional loans for older franchise manufacturers to fund existing franchise expansion. This makes them a fantastic financial partner to fund your franchise with a ROBS, Allowing you to come back to later once you need capital to develop.
FranFund Costs for the FranPlan
FranFund has two main prices with a ROBS transaction:
- Setup Fee: $4,795, $3,995 for Veterans
- Ongoing Maintenance Fee: $130 per month
What FranFund is Missing
FranFund doesn’t guarantee using an external counsel during an audit through their written contracts. While they say they will offer this additional feature if it is required, Guidant claims it . For more information, you can read our review of FranFund.
How to Apply With FranFund
It is possible to start with the application process for a ROBS through FranFund by registering online for a free consultation. They supply a Safety Net Program, which helps direct you through the process of moving your retirement funds to a tax deferred IRA account, free of price. This will speed up the ROBS trade and help you become funded in as quick 2 weeks.
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ROBS Provider With Longest Track Record: Benetrends Financial
Benetrends Financial is the right provider if you’re looking for the one with the maximum expertise. This matters to get a ROBS due to all of the details needed in order to become compliant with both the IRS and the Department of Labor. Benetrends is the pioneer of ROBS and has been easing rollovers for more than 30 years — twice as long as any other supplier.
What Benetrends Offers
Benetrends has never had a plan disqualified in more than 30 years, and they complete about 1,200 ROBS transactions each year. Just under 75 percent of the customers are franchisees, so they are another good option for franchise financing. They give a competitive cost with similar continuing support as their competitors.
Ongoing Support
Benetrends provides a guarantee that their on-staff professionals and attorneys will help you through all of matters of your audit without any extra expenses. If your audit case gets more complicated than they could handle, they promise to offer outside counsel at their expense, but it is not a warranty written in your contract. Benetrends believes that 95 percent of the customers can undergo an audit without outside help.
Additional Funding Launched
Benetrends works with clients on numerous loan options which include loans for startups, SBA loans, equipment financing, and much more. They will assist you in finding a lender and work with you through the procedure of getting your loan closed. Benetrends requires a $2,500 fee to begin the loan application process, but it’s reimbursed if they can not get you a loan deal.
Benetrend Costs for RainMaker Plan
Benetrends has two Chief costs at a ROBS trade:
- Setup Fee: $4,995
- Ongoing Maintenance Fee: $130 per month
The fee covers all Benetrends’ providers for as long as you are a paying client. You can cancel anytime using a 30-day note, but Benetrends doesn’t more support your accounts at that time.
What Benetrends is Missing
Benetrends has the expertise and can lead you through a ROBS as well as anyone, but they are middle of the street in both their price and their ongoing support. They are not any more affordable to setup a ROBS than Guidant or even FranFund, plus they don’t promise you access to an outside counsel if you require it inside your contract. For more information, you can read our review of Benetrends.
How to Employ Benetrends Financial
You can apply online for a free consultation with Benetrends to make sure that a ROBS is the correct selection for you. If you’re ready to move forward after that, you’ll cover your installment fee and start the process of rolling over your retirement funds into your company, which typically takes two — 3 weeks.
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The Most Affordable ROBS Provider: MySolo401k
MySolo401k is the ideal option if you want the most affordable supplier because their upfront prices are lower than anybody else, and they waive your maintenance fee for your first year. They may be a fantastic option to help anyone by means of a ROBS transaction only because they’ve experienced compliance officers and attorneys to direct your transaction and promise outside counsel when required.
What MySolo401k Offers
MySolo401k provides the guidance needed to finish a ROBS trade with the lowest costs and strong ongoing support. Their audit guarantee is as powerful as anybody else’s in the business, promising your plan will probably be compliant with the IRS and DOL standards. If it’s ever decided not to be compliant, then they’ll pay for an outside counsel to represent you via any tax court proceeding.
Ongoing Support
MySolo401k offers boundless ongoing support to ROBS experts and attorneys. They handle all your ROBS paperwork to you, including preparing and filing your Form 5500 and the inclusion of newly qualified program participants. They also have an audit guarantee on their site that promises to assist you through any strategy audit and promise to pay to an outside lawyer to represent you if the DOL or IRS ever allege that your plan was a prohibited transaction.
Additional Funding Launched
MySolo401k focuses on ROBS, but they also partner with third party lenders offering SBA loans. MySolo401k can therefore help their you with everything from finding an SBA-approved lender to closing the SBA loan.
Along with their own ROBS and SBA financing, they also supply retirement accounts like Solo 401ks and Self-Directed IRAs. Nonetheless, these aren’t used to put money into your business.
MySolo401k Prices
MySolo401k has two Chief prices with a ROBS trade:
- Setup Fee: $4,000, $3,500 for veterans
- Ongoing Maintenance Fee: $899 annually for up to 10 participants, $75 annually for every additional participant. This fee is waived for the first year.
What MySolo401k is Missing
MySolo401k supplies a nice ROBS option and we are currently collecting more information and speaking with representatives in the company in their other service offerings, for example SBA loan packaging. We’ll update this article as soon as we have more information on MySolo401k. In the meantime, you can read our review of MySolo401k.
How to Employ MySolo401k
It is possible to open the application process by filling out an online form that takes about 10 minutes. Once that’s finished, MySolo401k representatives will reach out to you for the next step in the process, which takes 2-3 weeks.
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Another ROBS Provider Option: Catchfire Funding
Catchfire Funding is just another ROBS alternative available to entrepreneurs desiring to your their 401k to begin a business. They are helpful to prospective small business owners who aren’t certain what type of company they would like to buy because Catchfire will help you get through the process of identifying a firm. But , we recommend first checking out among those prior providers on our list and utilizing Catchfire Funding as a last resort.
This is because one major disadvantage to Catchfire is they’re not upfront in their terms or costs. It’s unclear how great of a match they’ll be till you get in the process and find out more.
What Catchfire Funding Offers
Catchfire Funding offers help with ROBS transactions through their Self-Directed 401k Funding program. They are not upfront in their prices, but the procedure appears to be like their competitors.
Ongoing Support
1 thing which separates Catchfire Funding from their competition is that they’ll help you find the right company or franchise to buy or start. Catchfire Funding doesn’t provide details on how much support they provide after the ROBS trade is complete, but they seem to offer at least basic services, such as preparing and submitting your 5500 form.
Additional Funding Launched
Catchfire Funding also provides SBA loans via Diamond Financial.Catchfire Funding is an affiliate of Diamond Financial, so they will receive a fee as soon as your loan closes, but it is uncertain if it will impact your entire price.
Catchfire Funding Costs
Catchfire Funding has just two main fees associated with a ROBS:
- Setup Fee: Unknown
- Ongoing Maintenance Fee: Unknown
Unfortunately, it’s unclear how much Catchfire Funding prices because they’ll only supply the information to potential clients. They do offer a guarantee that if your ROBS either does not go through within 90 days, or if it fails an audit, then they’ll reimburse you whatever fees you’ve paid to that point.
What Catchfire Funding is Missing
They are not upfront in their process, ongoing support, or their fees. They also don’t seem to provide any direct lending themselves. While their ongoing guarantee is nice, they don’t guarantee the assistance of outside counsel at their cost. Have a look at our overview of Catchfire Funding to find out more.
How to Apply With Catchfire Funding
To apply for startup funding with Catchfire Funding you can complete an online form to register for a free consultation. They’ll work with you to determine your choices. Should you proceed with a ROBS then you may expect to be financed in 3-4 weeks.
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Bottom Line
In an industry where all providers offer a similar solution, it’s hard to separate the providers by much. Every one of them has similar fees and promise ongoing support that will assist you through your ROBS trade, even through the challenging job of managing it. The best one for you probably depends on which sort of business you’ve got and how you plan on using your ROBS.
But, Guidant has divided themselves from the rivalry in the market through their expertise and level of service. They help more business owners through the ROBS trade every year than any other supplier, and they supply more outside counsel support than anybody else, even at no extra price. You may sign up for a free 1-on-1 consultation to get started using Guidant today.
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