So you are now ready to open a retirement plan for your business. Whether you are looking to minimize taxes or provide a valuable perk to your employees, there are many different choices available depending on what you are trying to accomplish. Which plan should you open? SEP IRA? SIMPLE IRA? Individual 401k? Safe Harbor 401k? Cash Balance or a Defined Benefit plan? This article provides general guidelines on how to select an appropriate plan for your business. Whether a particular plan is a good fit for your business should ultimately be determined by your CPA or your fee-only retirement plan consultant.
When selecting a plan for your business you need to consider both your personal financial situation and your current and future business needs. For a business with only a spouse employee, your personal financial situation will determine which plan will best address your needs. A mature business with many employees might need a plan that is customized to the needs of the business owners, especially when the owners want to maximize their own contributions. A plan opened for a solo proprietor is not going to be appropriate for a business with employees, so it is important to understand how to transition your retirement plan as your business needs change.
Learn about these options; Owner with spouse employee, Small businesses with non-spouse employees, Midsize company, companies with high earning owners/key employees, Planning tips for small business owners, How to go about opening a plan, and How to run a successful plan at Konstantin’s blog HERE.