A rollover for business startups (ROBS) is a financing solution that lets you start or purchase a business with your retirement savings without paying early withdrawal fees or tax penalties. These transactions are difficult and confusing, which is why we recommend using an experienced ROBS provider. We’ve compared the best ROBS providers for startup businesses.
Top 5 ROBS Providers
ROBS Provider | Best for |
|---|---|
Highest level of service | |
Most affordable full-service ROBS service | |
Sole proprietors | |
Franchise funding | |
Experience with multiple industries |
How We Determined the Best ROBS Providers
401(k) business funding is heavily regulated and overseen by several government agencies. For this reason, we’ve selected providers with a good track record and years of experience with ROBS funding. We also compared setup pricing and ongoing fees to ensure founders got the best services per dollar on their startup funding.
Overview of ROBS Provider Costs
ROBS Provider | Setup Fee | Ongoing Maintenance |
|---|---|---|
$4,995 | $139 per month | |
$4,000 | $899 per year | |
$4,950 | None | |
$4,795 | $130 per month | |
$4,995 | $130 per month |
Guidant: Best Overall ROBS Provider
Guidant is the best fit for most entrepreneurs looking for a ROBS provider because it completes more ROBS transactions each year than any other provider and also offers more upfront support at a competitive price of $4,995. Guidant is the only ROBS provider that offers a free outside counsel consultation before you sign up.
Guidant Costs
- Setup fee: $4,995
- Ongoing maintenance fee: $139 per month for up to 10 employees; $3.33 per employee, per month, for more than 10 employees
Guidant’s costs are slightly higher than the other options on the list. However, this higher cost is justified because of the level of support Guidant offers its customers. The additional cost, when compared to other providers, is minimal and could be as little as $9 per month.
What Guidant Financial Offers
More than 1,600 small business owners use Guidant every year to complete a ROBS transaction, with fewer than 0.35% audited and no disqualifications. Guidant offers a free initial consultation with outside counsel, a full ROBS setup, ongoing maintenance, and IRS filings. If you need additional financing, Guidant will help you apply and, if you sell the business, it will handle unwinding the ROBS.
What Guidant Is Missing
Guidant is a great option to help you through the ROBS transaction, but its services are a little more expensive than the competition. It is also less integrated into the franchise community than some of the other ROBS providers we evaluated for this guide, like FranFund.
Guidant Financial Reviews
Guidant Financial has positive ratings. Users who gave positive Guidant Financial reviews cited its quality of customer support through the complex process. Users who gave critical Guidant Financial reviews said its fees were costly.
How to Apply With Guidant Financial
With Guidant, you can get funded with a ROBS in two to three weeks. The process starts with a free consultation where you can ask all of your questions. Guidant then offers you two free one-hour sessions with an outside counsel to decide if your personal situation merits a ROBS.
MySolo401k: The Most Affordable ROBS Provider
For those seeking the most affordable ROBS provider, the upfront fees for a ROBS with MySolo401k are $4,000, and account maintenance is free for the first year. MySolo401k has experienced compliance officers and attorneys to guide a ROBS transaction for all businesses and promises outside counsel when needed.
MySolo401k Costs
- Setup fee: $4,000; $3,500 for veterans
- Ongoing maintenance fee: $899 annually for up to 10 participants; $75 annually for each additional participant; this fee is waived for the first year
MySolo401k is the least expensive provider we evaluated both when measured on initial fees and ongoing maintenance. It attains lower costs by saving money on marketing and believes that because there is little maintenance to be done in the first year, your maintenance should not start until your second year of a ROBS contract.
What MySolo401k Offers
MySolo401k provides the guidance needed to complete a ROBS transaction with the lowest costs and strong ongoing support. Its initial consultation, setup process, guidance, and ongoing support are comparable to its peers. However, because of being focused only on ROBS, MySolo401k can only help with Small Business Administration (SBA) loans for additional financing.
What MySolo401k Financial Is Missing
MySolo401k offers a low-cost ROBS option and works with business owners to get funded. Because it does not offer financing options besides SBA loans, MySolo401k loses some of the financing flexibility offered by other providers like Guidant, Benetrends, and Pango Financial.
MySolo401k Reviews
MySolo401k has positive customer ratings overall. Users who gave positive MySolo401k reviews cited the quality of the customer service and its efforts to educate clients during transactions. Customers who gave critical MySolo401k reviews said it does not state a cancellation policy. You can find out more about what users think by visiting our MySolo401k reviews page.
How to Apply With MySolo401k
You can start the application process by filling out an online form that takes about 10 minutes. Once that is complete, MySolo401k representatives will reach out to you for the next step. After that, you will receive funding in two to three weeks.
Business Funding Trust: ROBS Provider for Owner-operators
Entrepreneurs needing less than $250,000 and who plan to be the only employee of the business may want to consider Business Funding Trust for ROBS. The initial charge to set up a ROBS is $4,950, and because Business Funding Trust does not offer ongoing maintenance, there are no additional maintenance fees.
Business Funding Trust Costs
- Setup fee: $4,950, due after setup, payable by the business
- Form filing fee: $300 per IRS Form 5500 filing
The unique pricing structure of Business Funding Trust accommodates businesses that will be exempt from the IRS Form 5500. It also charges its setup fee after the ROBS setup process, allowing your business to pay it, and allowing you to claim a $1,500 tax credit over three years.
Unlike other providers, Business Funding Trust does not provide ongoing maintenance for your account, which it states is unnecessary if you are the only employee. This means it doesn’t charge any ongoing fees, allowing you to save money.
What Business Funding Trust Offers
Business Funding Trust offers a base plan for setting up ROBS for your startup. It provides you with a complete plan administration binder, which suffices for maintaining the plan with the help of your accountant. Once you complete the ROBS transaction, Business Funding Trust is no longer involved.
What Business Funding Trust Is Missing
Business Funding Trust has simplified services and targets its ROBS at a specific type of entrepreneur. Having such a defined market has allowed Business Funding Trust to shed many of the ongoing support services in favor of self-guided ROBS maintenance. Compared to our other ROBS providers, it offers fewer services, but it passes along the savings by eliminating the monthly service fees charged by competitors.
Business Funding Trust Reviews
Business Funding Trust has an A+ rating with the Better Business Bureau (BBB). It has positive reviews around the web, citing its low fees and tailored solutions. We could not locate any negative customer reviews regarding this company.
How to Apply With Business Funding Trust
To start the ROBS set up with Business Funding Trust, you can get a consultation to understand more about its process and if it is the right choice for you. Afterward, Business Funding Trust will work with you to get your business funded in as quickly as two weeks.
FranFund: Best ROBS Provider for Franchises
FranFund is run by former franchise owners and is more ingrained in the franchise community than its competitors, making it a great ROBS provider for franchise businesses. In 2018, 92% of FranFund’s clients were franchises and, for a fee of $4,795, it will work to get your ROBS set up.
FranFund Costs
- Setup fee: $4,795; $3,995 for veterans
- Ongoing maintenance fee: $130 per month
FranFund offers its services at lower rates than Guidant Financial, charging $4,795 upfront for most customers. Besides its setup fee, its ongoing maintenance fee of $130 per month is comparable to other providers we evaluated. The standout component of its pricing is the large initial discount that it makes available to veterans.
What FranFund Offers
FranFund’s ROBS offering is like Guidant’s, but FranFund focuses on franchise businesses. It offers lower overall costs and plenty of support from initial content through the setup and unwinding your business when it is sold. Besides ROBS, FranFund also offers additional financing options for your business.
What the FranFund FranPlan Is Missing
FranFund’s written contract for the FranPlan does not guarantee the use of an outside counsel during an audit. While FranFund says it will provide this additional feature if it is needed, Guidant promises it in writing. Unlike Guidant, FranFund’s loan application consulting fee is nonrefundable.
FranFund Reviews
FranFund has positive customer ratings. Users who gave positive reviews for FranFund cited that its employees guided them through the process without problems. Those who provided critical reviews of the company said the fees were costly and continued for longer than necessary.
How to Apply With FranFund for the FranPlan
You can start with the application process for a ROBS through FranFund by signing up online for a free consultation. FranFund’s Safety Net Program is offered at no cost and can help you move your retirement funds into a tax-deferred individual retirement account (IRA). This will help you get funded in as quickly as two weeks.
Benetrends Financial: Longest Track Record ROBS Provider
Benetrends may impress entrepreneurs seeking an experienced provider. Benetrends is the pioneer of ROBS and has been facilitating rollovers for more than 30 years. Experience is crucial with a ROBS because of the details required to maintain compliance with the IRS and United States Department of Labor (DOL). Benetrends charges $4,995 for the ROBS setup.
Benetrends Financial Costs
- Setup fee: $4,995
- Ongoing maintenance fee: $130 per month
Benetrends’ setup and ongoing fees are in line with FranFund and Guidant. The fees cover all of Benetrends’ services for as long as you are a paying client. You can cancel with a 30-day notice, but Benetrends will no longer service your account.
What Benetrends Financial Offers
With more than 30 years of experience in the industry, Benetrends has never had its ROBS product, the Rainmaker Plan, disqualified, and it completes about 1,200 ROBS transactions annually. About 75% of Benetrends’ clients are franchisees, making it another good option for franchise funding. Benetrends offers competitive pricing with similar services to its competitors.
What Benetrends Is Missing
Benetrends has a significant amount of ROBS experience and can guide you through the entire transaction. However, a ROBS through Benetrends is not any more affordable to set up than a ROBS with Guidant or FranFund. Additionally, Benetrends does not guarantee, within your contract, access to outside counsel when you need it.
Benetrends Reviews
Benetrends reviews are positive around the web, including from people who used both its Rainmaker Plan and its SBA loan packaging. Critical reviews of the company highlighted customer dissatisfaction with the ongoing monthly fee, saying it wasn’t disclosed before obtaining their ROBS.
How to Apply With Benetrends Financial
You can apply online for a free consultation with Benetrends to make sure a ROBS with its Rainmaker Plan is the right choice for you. If you are ready to move forward, you will start the process of rolling over your retirement funds into your business, which typically takes two to three weeks.
Bottom Line
In an industry where all the providers offer a similar product, it is difficult to determine what sets them apart. Most of the providers have similar fees and provide ongoing support to help you through your ROBS transaction, and ongoing support to manage your ROBS once established.
Ian Atkins
Thanks for your comment. We regret the delay in answering but we appreciate your feedback, as our readers thoughts are a very important part of the information we want to share at Fit Small Business.
We believe that entrepreneurs who are considering investing their retirement savings into a startup through a ROBS should be as informed as possible before doing so. We agree that when selecting a company to help facilitate a ROBS, considering user reviews on sites like the BBB, Google, and Yelp can be an important part of a potential customer’s research. And in all Fit Small Business buyer’s guides, we summarize the user reviews we are able to find around the web.
But we also know our audience is looking for more than that, which is why our industry expert writers spend time researching ROBS and ROBS providers in greater detail. We cover the details that are often more difficult for potential customers to find in one place with the goal of adding value and insights not available elsewhere on the web.
We evaluate numerous components of every product we write about, including product features, price, how easy it is to set up, and usability. We strongly consider who is most likely to use the products and how those products might benefit their businesses. All of that information is balanced along with user reviews submitted to our site and many others to help us determine which we think are best suited to help business owners answer their questions and build their businesses.
It’s true that we have partnerships with some of the companies we write about on our site. Without those partnerships, we would not be able to pay our writers and analysts whose job it is to create the content that our community of small business owners and entrepreneurs rely on.
That said, the recommendations in our buyer’s guides and reviews are based on independent quantitative and qualitative assessments from our editorial team. Our editorial team always has the final say on whether a partner is included anywhere on our site. All of which is disclosed on every page of our site and in more detail here.
Thanks for reading.
Carol Krueger
Very interesting article. But I would like more information, please. There are nuances that I do not understand, for example: how to Apply With Business Funding Trust or What Business Funding Trust Is Missing.
Dennis Shirshikov
Hi Carol,
Thank you for asking the question.
Business Funding Trust is a ROBS provider that focuses exclusively on businesses that do not plan to hire any employees.
If this describes your business, you should also know that business funding trust will not handle the majority of the paperwork, instead they will provide you with a information on how to complete the process mostly yourself, but will be available to answer any questions.
This is largely the reason for their reduced overall fees, to apply with them, simply click the link in the article, and you will be taken to their site.
They are very responsive via phone, email, and their online application typically getting back to you within a day or two.
Thanks for asking,
Dennis Shirshikov
Louis
Do i have to continue the yearly administrative fee or can I do it myself after the rollover has been done.
Jeff White
Hi Louis!
Part of the complication in using a ROBS is setting it up, but the other difficult part can be correctly abiding by the rules after you’ve received the money. You could technically do it by yourself, but you’ll need to be confident that you can fill out the annual 5500 form, know when employees become eligible, and have a system in place to notify eligible employees of their rights within weeks of them becoming eligible. If you feel comfortable in those things and think you understand it then it’s not required you use a provider. However, to prevent your business from making a mistake we recommend using an experienced ROBS provider.
Best,
Jeff
Krista
Thanks for your objective article, Jeff. Do you have any similar information/research on Pango Financial?
Jeff White
Hi Krista!
Currently we haven’t done a complete write-up on Pango, but we’ll include it to our list of providers to consider in the future.
Best,
Jeff
Alex Rowzani
want more info please
Jeff White
Hi Alex!
Thanks for your inquiry into a ROBS! Essentially, a Rollover for Business Startups is a great way to fund a new business, the purchase of business assets, or a franchise. It helps you rollover your current retirement funds into a tax deferred account that gives your business full access to the funds because the new retirement account buys shares of the business. To learn more you should check out our ROBS ultimate guide.
Best,
Jeff