XYZ Company is would like to start providing retirement benefits to its employees. The 2 owner employees of XYZ are especially interested in saving for their own retirement, as both have just turned 50 and will soon have no more college tuition to pay for their children. XYZ has 75 employees, 10 are highly compensated employees all of whom are over 21 and have a year of service, and 65 of whom are non-highly compensated employees, 30 of whom are between age 20 and 30, with the remainder all over 30. The workforce size has been fairly stable with about 10-15 employees hired each year. The non-highly compensated employees tend to stay with the company an average of four years. XYZ's earnings tend to vary substantially from year to year, depending on the economy. 

What sort of retirement plan would you recommend they adopt? Why?

What key features of the plan (participation, vesting and benefit accrual) would you recommend?

What other features would you add to this plan? Why?