Business Retirement Plans – How Owners’ Benefit!

Saving Money to Go Skiing !

Secure Your Future: The Benefits of Retirement Planning for Business Owners and Solopreneurs

Business owners and solopreneurs can personally benefit from opening a retirement plan. It offers tax benefits, increased savings opportunities, and potential employee retention benefits.

If you have a plan, don’t leave your financial future to chance! Take action now and benchmark your plan for costs, investment results, compliance, and tax benefits. Doing so can ensure that you are making the most of your investments and maximizing your returns.

Why it Matters:

  • Owners may be eligible for significant tax deductions – up to $73,500 for defined contribution plans and up to $265,000 for defined benefit plans
  • Up to $15,000 in federal tax credits to offset startup and employee educational costs.
  • Keeping employees happy and building retention is essential for standing out from competitors
  • Stay in compliance with Colorado and other States’ emerging employer savings mandates

Examples of Plans in Action

Safe Harbor 401k plans are a win-win for business owners. With the ability to make significant owner contributions of up to $30,000 annually, owners can secure their retirement while reducing their business tax liability. Plus, this valuable benefit helps attract and retain top talent. Roth savings options are also available.

Individual (Solo) 401k:  An individual 401k is a retirement savings plan for self-employed individuals or small business owners. John is a consultant who earns significant income from his work. He decides to open an individual 401k to save for his retirement. With an individual 401k, John can contribute up to $30,000 annually as an employee and make a profit-sharing contribution of up to 25% of his self-employment income. By contributing to his individual 401k, John can reduce his taxable income, save for his future, and benefit from the tax-deferred growth of his investments.

Compared to a SEP IRA, an individual 401k has several advantages. While both plans allow for tax-deferred growth of investments, an individual 401k allows for higher contribution limits. An individual 401k allows catch-up contributions for those over 50, which a SEP IRA does not offer. An individual 401k also provides the option for loans, which a SEP IRA does not. Overall, an individual 401k may be better for self-employed individuals or small business owners looking to maximize their retirement savings.

Defined Benefit Plans: As a highly paid individual with few or no employees, have you considered a defined benefit plan for your retirement savings? With this plan, you can contribute substantial money each year based on your income and age, allowing for a significant retirement benefit. For instance, if you’re 50 years old and earn $300,000 per year, you may be able to contribute up to $190,000 or more – annually to your defined benefit plan. This plan also offers tax benefits, potentially saving you thousands of dollars in taxes each year. A defined benefit plan is a smart choice for those looking to maximize their retirement savings while reducing their tax liability future together!

What next? Are you a business owner looking to secure your financial future with the best retirement plan? Look no further! Contact me today to discuss your options and determine the best plan for your needs. From individual 401ks to defined benefit plans, I can guide you through the process and help you maximize your retirement savings while minimizing your tax liability. Don’t wait until it’s too late – take control of your retirement today, and let’s ensure a comfortable future for you and your loved ones.Top of Form

Schedule a call with me here to get started.