Saturday November 21, 2009

smSmallBiz.com - SmartMoney's Small Business Site

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Small Business Retirement Plans
Here's a rundown of your retirement plan options. The best plan will vary depending upon your needs.
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joe Posted: 6:44 PM On November 12, 2009
I wonder. If a company has been funding a Sep IRA for several years can they stop funding that program and implement a SIMPLE IRA? My confusion is that one of the rules of the SIMPLE plan is that you do not have another plan. What exactly does this mean. Also, can a Profit Sharing plan be used in conjunction with a SEP, SIMPLE or a 401K plan and shat might be the PROS & CONS?
Sarah G. Posted: 2:04 AM On May 22, 2009
As the economy still striving to bounce back, saving money for the future is very crucial. But a lot of the options for short term funding have been drying up. Short term funding is a necessary thing to have around, and going through traditional channels such as banks isn't an option for a lot of people anymore – basically it's only open to Ken Lewis. Installment loans are an option, but some people, including senior citizens, have been thinking about raiding their retirement fund. Getting into your pension retirement plan or 401(k) funds is the last thing you want to do if you don't qualify for any withdrawals yet. The penalties are substantial, and you'll end up needing installments loans to pay them if you use retirement funds for <a rev='vote for' title='Installment Loans Reliable Option As 401(k)s are Dwindling' href='http://personalmoneystore.com/moneyblog/2009/05/17/installment-loans-reliable-option-401ks-dwindling/'>short term funding</a>.
David conway Posted: 1:33 AM On November 19, 2008
To all you retieries, if its worth anything, i'd like to help out by informing everyone here. that a site called www.kantabiz.com should help anybody with a small business. Its worth having a look at for its advertising advantage. God bless.
Eddie Posted: 9:32 AM On September 17, 2008
Maybe someone can give me some info here...
I work for a small, disabled veteran owned company and am employed on a government installation. They make us involuntarily contribute 4% of our earnings into a 401(k) program that is almost impossible to get your money out of as a hardship withdrawl. Is this legal? If so, can you unenroll or are you automatically held to being in this program??
Any info is greatly appreciated!
theneworleanssaints@hotamil.com
Daryl Posted: 11:14 AM On August 29, 2008
I was contacted by a reader of this article based on a previous comment by the blogger KD. KD was somewhat right in his assessment of what we do; but there is a much easier way to explain my company’s services. Essentially, we help business owners fund their personal retirement nest egg by using 'other people’s money'. I don’t want to sound like a walking advertisement, but if you want to find out more, go to www.financedplanning.com and/or simply email me at dmbrandon@entaire.com. It will be worth your while if you are unsure about how you’re going to retire with an income stream that you’re comfortable with. Also, if you know someone who may be interested in speaking with me as well; referrals are always welcome. I’ll find a way to compensate you for your referral.
Steven Posted: 10:08 AM On June 11, 2008
The concept is that the company (can be as little as 1 person) pays a 'bonus' to themself or to highly paid employee(s), the money is put into a tax deferred vehicle but since the tax is paid up front by a company called Peachtree LBP, there is no tax that is having to be paid when it comes out & can be taken out at anytime without penalty. Basically, you're borrowing other money at a very low interest rate (5%) & its all deductible! We did this for my company and a friends company and were going to be in a better position than we would had we been in a 401(k) becuase of the fees & the tax free growth. I highly recommend them!
Steven Posted: 10:07 AM On June 11, 2008
I experienced huge growth which was great but a pain when it came to retirement planning & cost for myself & employees, I was in a 401(k)that I safe harbored to make my highly paid ee's happy. After I sold that in the late 90's, I started a small firm & was in a SEP & Solo 401(k). Recently, I was introduced to a concept that I thought was amazing that some of you maybe interested in. I was introduced to this by my CFP and CPA who had used this in the past for other groups that was experiencing problems with their retirement planning.
KD Posted: 11:31 AM On June 2, 2008
Ken,
There's a company out there that ONLY works with business owners to fund their retirement plans. I heard about them through our Chamber of Commerce here in the Atlanta area. I hope I'm explaining it correctly, but they basicially use your business's cash flow or A/R to fund your personal retirement plan. They invest a small portion of your A/R into a long term, low cost intrest-only loan to fund a huge lump sum of money. They invest that lump sum of money into a very conservative financial engine to give you the benefits of using that large amount of money to grow your retirement fund by using compounding intrest. Anyway, I just wanted to say that there are more options for small business owners out there. Google the company (Entaire) for more info. If you decide to call them, ask for Daryl.
Leah Posted: 10:51 AM On May 3, 2008
Ken,

The cost for the 'easy 401k' sounds pretty suspect (or very limited), while the Fidelity example is quite high, given market averages for a typical 'out of the box' 401k; for that cost, you could have instituted a flexible, scalable prototype solution, or even an age weighted 401k/PS combination.

Additionally, when comparing these costs, it's important to note (though not outlined above) that you will qualify for a $500 rebate from the government for the next two or three years on the costs of your new plan...which will make it significantly cheaper.

But one of the most important things to consider (I think) is what investment options will be available to you once you're in the plan, and what kind of support you'll see. At $795, I'm fairly sure you're going to have some very restricted investment/plan options.
Mike Posted: 3:49 AM On April 16, 2008
Ken - You may want to look at 'Simple 401K' plan. It's not great as the 401k but it doesn't have the expenses either.
Ken Posted: 5:38 AM On April 15, 2008
I'd like to see some info on where a SMALL company that doesn't qualify for a solo 401k can get a 'cheap' regular 401k. I have ONE employee, and therefore don't quaify for the solo. I've seen the website 'easy 401k' but I don't know much about it, and even it is a LITTLE expensive ($795 on time fee, $295 a year, I believe, thereafter)
ews Posted: 9:29 PM On April 9, 2008
This is so simple that it is wrong in many places. Doesn't even mention the best set up to get the most funding, a DB + PS/401k.

Hope no one thinks you can really use 2 years for eligibility for a 401k Plan.
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