If you’re in need of business funding, a rollover for business startups (ROBS) can be a great way to unlock access to your retirement funds, tax- and penalty-free! Since a ROBS requires you to navigate complex tax regulations, partnering with the right ROBS provider can ensure that you get the proper guidance throughout the process and won’t have to worry about being assessed fines or penalties later. Many of the best providers also offer concierge-level service to keep you on track, allowing you to access funding as quickly as possible.
From being able to provide individualized tax support, legal advice, and monetary protections, here are my picks for the best ROBS providers:
- Guidant Financial: Best overall for service and protection
- Pango Financial: Best legal support for simple transactions
- My Solo 401k Financial: Best for plans with fewer than 30 participants
- IRA Financial Group: Best for low balance requirements
- Business Funding Trust: Best for long-term affordability
Looking for a free business consultation session? Checkout Guidant Financial and see if they are the right ROBS provider for your business. |
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Best ROBS 401k providers at a glance
Provider | Setup fee | Monthly maintenance fee | Funding speed | Legal/audit protection | Est. value of legal support |
|---|---|---|---|---|---|
| $149+ | 3 weeks | Yes; internal and external | Up to $5,000+ | |
 | $129 | 10 days | Yes; internal and external | Up to $6,000+ | |
 | $3,000 | 2-3 weeks | Limited | $500 | |
 | $3,500 | $100 | 2-3 weeks | Yes | $500 |
 | $4,950 | $0 | 2-4 weeks | Not stated | $0 |
Guidant Financial: Best overall for service and protection
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Rates & Terms | |
Initial Setup Fee | $4,995 (10% discount for veterans) |
Monthly Maintenance Fee | $149+ |
Funding Speed | As fast as 3 weeks |
ROBS Services Provided |
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Legal Support |
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Audit Protection | Yes; full audit protection covers costs of legal representation if audited |
Qualification | |
Minimum Required Balance | $50,000 |
Why I like Guidant Financial
When I think of Guidant Financial, I think of a premium price tag and premium services. In other words, you get what you pay for. While you could opt for more affordable options, it’s hard to match Guidant Financial’s offerings. As a testament to its quality, Guidant also offers a money-back guarantee if you’re unsatisfied with its services.
A standout feature with Guidant Financial is that its ROBS clients get the ability to consult with internal and external legal counsel of their choice. On top of that, the company covers all costs associated with representing your business in the event of an audit from the Internal Revenue Service (IRS) or Department of Labor (DoL). Considering the average cost of an attorney typically ranges from $200 to $400 per hour, this could save your business a significant amount of time and money, making it my top pick for legal and audit representation.
That said, it’s unlikely that you’ll ever need to utilize those services, as Guidant Financial has a spotless record of delivering fully compliant ROBS plans.
To learn more or to begin the process, you can visit the Guidant Financial website. There, you can schedule a free initial consultation to determine whether a ROBS is right for you.
Pango Financial: Best legal support for simple transactions
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Rates & Terms | |
Initial Setup Fee | $4,695 (15% discount for Veterans & First Responders) |
Monthly Maintenance Fee | $129 |
Funding Speed | 10 days |
ROBS Services Provided |
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Legal Support | Internal and external offerings for operational support and compliance assistance. |
Audit Protection | Limited; provides assistance to your accountant or certified public accountant (CPA) |
Qualifications | |
Minimum Required Balance | $30,000 but can vary |
Why I like Pango Financial
Pango Financial calls its ROBS product the Dreamspark Plan, and I highly recommend it if you have a simple rollover transaction. Like Guidant Financial, Pango Financial offers internal and external legal support in the unlikely event that you need it. It also offers a money-back guarantee. However, its audit protection service is primarily limited to providing support to your designated accountant or CPA. For that reason, I believe it would be better suited for less complex deals.
One highlight of Pango Financial is that while most ROBS providers require a minimum balance of $50,000 to be eligible, you have some flexibility here as you can go as low as around $30,000 in some cases. However, I recommend that you ensure that the amount of funding you’d be getting access to is worth the ROBS-related fees being paid.
Long-time followers of Pango Financial may also have noticed that its fees have increased over the past several years. Its setup fee, for example, used to be $3,995, down from its current price of $4,695. Pricing increases have been standard across the industry, but Pango Financial has continued to add value to its ROBS package to remain highly competitive.
Free initial consultations are available for those interested in partnering with Pango Financial on a ROBS transaction. Visit the company’s website to submit an application and start the process today!
My Solo 401k Financial: Best for plans with fewer than 30 participants
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Rates & Terms | |
Initial Setup Fee | $3,000 |
Monthly Maintenance Fee |
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Funding Speed | 2 to 3 weeks |
ROBS Services Provided |
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Legal Support | Yes but may be limited |
Audit Protection | Yes but may be limited |
Qualifications | |
Minimum Required Balance | $30,000 but may vary |
Why I like My Solo 401k Financial
The pricing structure of My Solo 401k Financial’s ROBS plan makes it more cost-effective than many other companies if you don’t anticipate having more than 30 plan participants. Businesses that eventually grow, hire more employees, or otherwise expect the pool of plan participants to expand, may do better considering alternative ROBS providers from an affordability perspective.
My Solo 401k Financial also might not be the best fit if you’re a business owner who wants to have a large team at your disposal to help with audit issues or questions about your plan. That’s because My Solo 401k Financial only advertises the availability of a single Harvard Law attorney and one compliance officer to assist with these items.
Although it may seem that this company only caters to smaller companies, it is extremely popular with well-known franchises. This is a testament to the quality of its ROBS offering. Recently funded franchises include Meineke Car Care Center, Subway, The UPS Store, Fedex, Farmers Insurance, and Papa John’s Pizza.
Interested business owners can join the company’s daily “office hours” webinar. The link is available on the company’s website, where you can also submit an application to get the process started.
IRA Financial Group: Best for low balance requirements
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Rates & Terms | |
Initial Setup Fee | $3,500 |
Monthly Maintenance Fee | $100 |
Funding Speed | 2 to 3 weeks |
ROBS Services Provided |
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Legal Support | Yes, tax and ERISA support offered |
Audit Protection | Lifetime IRS audit support |
Qualifications | |
Minimum Required Balance | None but $30,000 is recommended |
Why I like IRA Financial Group
Given the amount of fees most ROBS providers charge, I don’t usually recommend doing a ROBS if you won’t be rolling over at least $50,000 to make it worth the cost. However, if you’re in dire need of money, IRA Financial Group can be a good option since it doesn’t have a hard minimum to be eligible for a ROBS.
IRA Financial Group also offers additional value-added services if you want to consolidate and save money elsewhere. For example, ROBS customers also get a free HSA and Coverdell account for the first year, a value of $990. IRA Financial Group can also provide assistance with helping you qualify and get the $5,000 start-up tax credit, generate up to $1,500 in tax credits over the course of three years, and get a free Roth 401(k) option. Free access is also provided for educational webinars, podcasts, and newsletters.
Start the process today with a free initial consultation by visiting the IRA Financial Group website.
Business Funding Trust: Best for long-term affordability
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Rates & Terms | |
Initial Setup Fee | $4,950 |
Monthly Maintenance Fee | $0 |
Funding Speed | 2 to 4 weeks |
ROBS Services Provided |
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Legal Support | Provides up to $10,000 in legal fee coverage |
Audit Protection | Includes IRS audit guarantee |
Qualifications | |
Minimum Required Balance | $50,000 |
Why I like Business Funding Trust
If you’re looking to keep your long-term costs low, Business Funding Trust is a good option to consider because it charges no monthly or recurring maintenance fees. It can also help you qualify for tax credits of up to $1,500, which can further reduce the effective cost of a ROBS.
Business Funding Trust has the ability to charge no recurring fees because it takes a “do-it-yourself” DIY approach. After the initial setup, you’ll pretty much be left on your own when it comes to managing your plan. You will, however, get access to an instructional guide and kit with information on what you need to do to keep your plan fully compliant with tax and other regulatory requirements. If you decide that this DIY approach isn’t for you, the option to pay an additional assistance fee is also available.
One downside is that the company offers little in the way of legal support or audit assistance. If this is not a dealbreaker for you, visit the Business Funding Trust website to learn more or to begin the application process.
How I chose the best ROBS providers
When I conducted my research in finding the best ROBS providers, I considered factors that would impact a company’s bottom line:
- Fees: In addition to one-time setup fees, I also looked at recurring monthly maintenance fees charged, as these could easily impact a company’s cash flow and financial ability to invest in other areas of the business in the long run.
- Legal support and audit protection: Although rare, audits by government organizations like the IRS or DoL can occur. Even if your plan is compliant, documenting it in an audit can cost quite a bit of time and money. ROBS providers offering legal support and assistance can easily reduce the headaches involved with these processes.
- Money-back guarantees: Nothing screams confidence like a money-back guarantee, as it forces the company to deliver outstanding service to ensure your satisfaction.
- Track record of maintaining compliant plans: A company’s past performance is usually a good indicator of its future. ROBS providers with a flawless history of delivering compliant plans are likely to continue doing so, as it represents the level of their knowledge and expertise in these transactions.
- Funding speed: Time is money! The faster you can get funding, the sooner you can use the money for your business needs.
- Qualification requirements: ROBS providers that had more flexibility in the minimum balance requirements were viewed more favorably, as it provides greater access for more business owners.
- Customer reviews and ratings: Past customer experiences are a great indicator of what you can expect from the company moving forward. ROBS providers with a consistent trail of happy customers are a good sign that you too can expect the same.
ROBS alternatives
In the event that you don’t qualify for a ROBS or are simply exploring all of your financing options, here are some alternatives to consider:
- 401(k) financing: If you have a 401(k) but don’t have a sufficient balance for a ROBS, you can still use it as collateral to get funding. This can include using a loan against the account or withdrawing from the retirement account. You can read more about this in our guide on how to use a 401(k) to start or buy a business.
- SBA loan: For businesses with a strong credit history, SBA loans offer lower interest rates than other small business loans and have a variety of loan programs. While disbursement can be a longer process, it’s a good option for qualified businesses. You can learn more in our guide on SBA loan types, rates, and requirements.
- Personal loan for business purposes: A personal loan can be used for business purposes by businesses that are ineligible for traditional financing but have good personal credit and income. There are few fund restrictions, although loan amounts may be less than standard business loans. See our list of the best personal loans for business funding to view providers with low rates and flexible loan terms.
- Angel investors: In exchange for equity in your company, angel investors can provide seed money to startups with limited resources. There is no repayment obligation, like financing with a traditional loan, and it typically has a less formal process. To learn more, read our guides on the pros and cons of angel investors funding your business and how to raise angel funding.
- Venture capital: Similar to angel funding, obtaining funding from venture capitalists provides a debt-free financing option, where ownership stakes can be offered in exchange for funding. Our articles on what venture capital is and how to raise venture capital can help you determine if the ROBS alternative fits the bill.
- Friends and family loan: Sourcing funds from friends and family is often less formal and can offer favorable interest rates and loan terms. To learn how to approach them to help finance your business, read our guide on raising money from friends and family.
Frequently asked questions (FAQs)
The main benefit is getting tax- and penalty-free access to your retirement accounts. These funds can then be used for nearly any business purpose. Since the funds are not a loan, you will neither be required to repay the proceeds nor will you have to pay any interest charges.
You’ll typically need to be registered as a C-corp, have an eligible retirement account with a minimum balance of $50,000, draw a salary as an active employee, and allow employees to contribute to the C-corp’s retirement plan. Learn more about how a ROBS works, how to qualify, and how to choose a provider in our ultimate guide to ROBS transactions.
You may have to pay taxes and early withdrawal penalties if you complete a ROBS but end up not using the funds for a qualifying business venture. If you’re concerned this might happen, you can consider other types of startup business loans instead.
Bottom line
The best ROBS providers should offer services that support a ROBS transaction, including tax or legal advice, low startup fees, and audit assistance. With a ROBS 401k provider, you can set up a ROBS and access your retirement accounts without any tax or early withdrawal penalties. Since a ROBS can be a complex transaction, you’ll want to work with a provider that can assist with the process and help you with your business needs.
