Segments of the US marketplace, such as the energy industry, are now having to make some difficult decisions
with respect to their company retirement plans. It is very important that decisions such as these be made while consulting an experienced ERISA professional for if the retirement plan is not handled correctly, significant liability can be created.
For many, retiring with a million dollars would be a dream come true. However, for a highly paid professional, a million dollar retirement nest egg may only be a third or fourth of what is actually needed. Numerous studies have shown that key to a successful retirement is the management of the annual withdrawal rate. Industry professionals recommend withdrawing no more than five percent of your retirement savings in any year. Therefore, a million dollar retirement nest egg will only provide a $50,000 annual retirement income, two million would provide an annual retirement income of $100,000, and so on. Essentially, one takes the desired annual retirement income and divides that number by 5% (.05).
Topics: Pension, Retirement Planning, 401(k)
Is a Cash Balance Plan the Right Fit for My Company? (Part 2)
Now that you know what a Cash Balance Plan is from reading Part 1 Is a Cash Balance Plan Right For My Company? Part 1 of this series, the next step is: What are the reasons for setting up a Cash Balance Plan?
Topics: Pension, ERISA, Cash Balance
If you or your client is one of the thousands of business owners that have a SIMPLE IRA retirement plan, then you may want to reconsider the options. Below are 3 reasons a 401(k) is better than a SIMPLE (Savings Incentive Match Plan for Employers) IRA.
Topics: Pension, 401(k). SIMPLE IRA