Small Business Retirement Plan, A Good Business Opportunity

Many people belief that retirement planning is only for people who get a salary, but it is also necessary for who run their own business. There are many ways to do this, the better you are prepared for your retirement, the better you will be prepared for the future. And when the present is very important, your future, when your senior years come, living a life as independent and dignified as can be is also important. So if you want to live that part of your life financially comfortable the small business retirement plan, is a good place to start.

You need to think big when it comes to the small business retirement plan. In your working years you can prepare for your financial independence when retired. When you start with your small business retirement plan at the right time you need to keep in mind that saving a considerable amount of money for the future, can also save you a great deal on tax deductions in the present. With The small business retirement plan you can fill in any gaps in your personal savings and you can secure your retirement time.

Tax deduction on the amount of your savings for the future is a great advantaged of the small business retirement plan because:

– These savings will not incur tax until it is withdrawn.
– You can also include your spouse in to increase the amount you save when you are partners in business .
– By extending this plan to your small business employees there are more benefits.

Small Business Retirement Plan For Your Employees

The first small business retirement plan is the Savings Incentives Match Plan for Employees (SIMPLE) IRA. Your employees can contribute if they have earned more than $5,000 in any two years prior and who will earn at least $5,000 this year, and you as their employer need to match whatever sum they contribute with a ceiling of US $6000-10000. And your employees can contribute up to $10,000. You as their employer can provide up to 3% match or 2% non-elective match for all your employees up to $4,400 per employee. You can also contribute $10,000 to your own account plus a match of 3%.

When you are employing just a handful of employees, which is often the case with small businesses, then the Simplified Employee Pension Plan (SEP IRA) can be the right plan for you and your business. With this small business retirement plan your workers do not contribute, you contribute on the behalf of all of your employers. Any business owner or self-employed individual can start a plan. All employees who have worked for 3 of the past 5 years and who earned at least $450 last year are eligible for coverage.The contributions you make can differ from year to year and you can let it depend upon your business returns and the sum of these contributions is tax deductible.

The small business retirement plan provides benefits for your employees and for yourself. The plan also generates some major tax savings. This way you are creating a safe future for you, your family and for your employees.

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