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IRS 401K - Effective Retirement
Financial Planning With Limits
With over 50 million members, the IRS 401k, aka 401(k), is a very popular retirement
financial plan.
The IRS plan is for both employers and employees. Small businesses can
also join in such a financial plan.
The IRS has established a four (4) step cycle for the plan.
1. Chosing the 401K
This action is
primarily for the employer.
If you are an employer or business owner looking to establish your own
401K, check here for IRS details.
The maximum employee contribution limit has gone from $15,500 in 2008
to $16,500 in 2009. Plus there is an allowable "catch-up" contribution
for those over 50 years...
Employee contributions are always
100% vested. That means you are legally entitled to that money, even
though you may not see it, or may not physically bank it, etc. The
money is legally yours.
The employer contributions are on a graduated scale. Check with your
employer for exact
details on your company's specific plan.
2. Establishing the 401K
A bank,
insurance company, or mutual fund provider is found
to maintain your 401k plan.
The plan is written up. Recordkeeping is developed. A trust is
arranged. Employees are informed about the 401k.
3. Operating the 401K
The financial
entity to manage the plan is established and ready for business.
All employers have specific
401k guidelines. Check with your employer to find out exactly. Your age
(under 21 years), or your length of service could be a factor as to
when you can participate.
As discussed above, all employee contributions are 100% vested. The employer
contributes on a scale which is explained in part here.
These rules are nondiscriminatory.
4. Terminating the 401K
Summary
A 401k can and should be considered
as part of your employee
compensation. However you do not have to pay taxes until you withdraw
funds.
A good 401k program is an incentive
to employees.
Sometimes, this is not enough for a substantial
retirement financial
plan. As your 401k
planning is limited in the funds you can establish,
odds are that you need to do more to plan for your retirement.
An Annuity
Has Significant Benefits
An annuity
has significant
benefts to your retirement financial planning...
You can grow a small
monthly amount to a large base for your retirement (deferred
annuity)...
Or, you can obtain steady
monthly income in the very near future (immediate
annuity)...
Get help to get the best
for your needs...
Get a good annuity
quote
- let us help guide you
through
the options to make the best choices for you!
Or, get a free consultation from a Certified
Financial Planner to go
over your plans to help you make the best decision for
your needs.
"You'll be glad
you did the right thing."
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