I just found another benefit of my SEP.  Forget profit sharing, as stated in the related discussion, it’s hard to calculate and is totally subject to the owner’s discretion.  The way I have found to motivate my employee’s to stay with me, is through my SEP.  After an employee has worked for me for 3 years, I am required by law, to contribute the same percentage deposit to a SEP for them, as I do for myself (I’ve maxed mine out for the last 10 years).  I make this clear at the beginning of the employment and remind them of this as their tenure increases.  I don’t contribute before this time, I reward them with semi-annual raises.  As their wage increases they see me as an employer who respects their talents.  I use the raises as a means to motivate them to improve weak skills.  Rarely are these mechanical skills, most guys are always trying to improve these.  The skills I try to elevate are paperwork and managereal. If they are an asset to my company I’m thrilled to contribute to a SEP for them, and once they are in the program, how could they jump ship.  Three years is a relatively short time and by then I know what an asset they are.  They see me as a prudent businessman and with 3 years experience they’re making themselves and my company some great profits.  Take care of your help for the long range, and they’ll take care of you.