RETIREMENT PLANNING
Retirement planning involves evaluating your current financial standing and creating an accumulation strategy that will help to ensure a desired retirement lifestyle. Because an individual’s retirement years can span decades, retirement planning generally dominates other financial goals. A successful plan put into place during the wealth-building lifespan should address ways to maximize growth and tax-efficient distributions, as well as how to leave retirement assets to the next generation.
There are several ways to save for retirement:
- Qualified employer-sponsored plans
- Individual retirement accounts (IRAs)
- Personal savings
- Executive deferral plans
Qualified plans are employer-sponsored retirement plans such as 401(k)s and pension plans. Although there are contribution limits and strict distribution rules, these plans are popular because of their tax benefits. Generally, employers will make participation even more attractive by matching all or a portion of an employee’s contribution. It’s important that you choose the optimum plan to benefit the key people in your company.
IRAs are inexpensive, easy to establish and maintain, and also offer favorable tax incentives. They can be created by an individual or provided by an employer. IRAs can be used to consolidate retirement savings that were previously held in employer-sponsored plans. Our process can help coordinate your IRA investments with your other savings plans.
You may find that qualified plans, IRAs, and social security won’t provide enough money to support your desired retirement lifestyle. By identifying your retirement gap, you can develop a strategy for personal savings invested outside of the traditional retirement vehicle.
Business owners or executives may have access to other tax-advantaged retirement savings vehicles. Nonqualified executive compensation is a generic term used to describe a compensation arrangement that provides retirement income—and, in some cases, death benefits—to key employees of a business.
At the heart of any retirement plan is the distribution of accumulated assets. A thoughtful distribution strategy can help you manage retirement income, address tax considerations, and align your withdrawals with your overall financial goals. From distribution options that may provide access to retirement assets before age 59½ to income-oriented solutions designed to support retirement cash flow, distribution planning is an important component of a comprehensive retirement strategy.
This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Investors should consult with a tax or legal professional regarding their individual situations.
