Retirement funding for entrepreneurs and small businesses can seem much more complicated than it really is. Many entrepreneurs have great ideas and take great care planning and preparing their businesses for success. Unfortunately, they tend to fall short when it comes to setting up their retirement funds. Some business owners just don't believe that setting up a retirement fund is a viable option for them -- especially if they own a startup. They may be waiting to achieve more financial security before seeking retirement funds information so they can compare available options. While being your own boss is liberating, failing to prepare for your future is anything but.
Deciphering retirement funds information doesn't need to be any more complicated for business owners than it is for employees of large corporations who opt into retirement programs. There are several plans available. You can also set up your own retirement fund, and maybe even wind up saving more money each month than you would have working for someone else. This guide will help you:
1. Find a SEP retirement fund to save money now and in the future.
2. Research Solo 401k retirement fund information for small business owners;
3. Consider payroll deduction IRAs to build your retirement fund.
Compare SEP retirement funds for small business ownersPlanning for the future, and not spending a fortune on doing so, is important for anyone, but especially for independent business owners. Simplified Employee Pensions (SEPs) are an affordable option if you are a small business with employees, because it does not require the start-up costs of many retirement funding programs.
Consider establishing a Solo 401k plan to secure retirement fundsWhen you compare retirement funds, consider a Solo 401k plan, which allows you to max out your contributions to tax deferred retirement accounts. You receive a tax credit whenever you deposit money into your account, and contributions to the account are flexible. There is no set minimum amount to contribute - you could skip contributing for one year if necessary.
Research payroll deduction IRAs as a retirement funding solutionA payroll deduction IRA (Individual Retirement Account) allows you to set the amount of money you plan to contribute each pay period into your IRA account. If you are 50 or older, you can contribute tax-deductible funds to a traditional IRA yearly. Roth IRAs, while not tax deductible, allow for more flexible withdraws, which may appeal to small business owners.
- Target retirement funds may be a consideration if you have a specific date when you plan to stop working. The best target retirement funds start off with aggressive investing at the beginning, then taper off as you get closer to your retirement date.
- To make sure you get the best retirement fund for your business, hire a financial consultant. Most financial institutions who offer retirement plans for business owners can provide you with consulting services.