Retirement is a major milestone for many of your employees. Leaving the workforce is as major an adjustment as entering it. In some cases, your retired employees will seek to remain on the payroll as outside consultants and not actual in-house staffers. This situation understandably leads to some confusion. As such, it’s worth examining retirement and its related benefits every once in a while.
Benefits of Special Interest for Everyone
For the most part, every retirement plan you see has built-in tax deductions and other benefits. Contributions to your traditional 401(k) decrease the amount of income considered “taxable,” but this is not as bad as it sounds. It’s a good thing! If you decide to have a Roth 401K0) plan, you will see less money come from it. However, the fair trade here is that your withdrawals are not subject to taxation. Some companies offer matching contributions, which is another viable path to financial stability even after you’re not working anymore.
Defined Contribution Plans
DC plans, as they are known, are relatively new concepts. They have only existed since the 1980s. They dominate the retirement marketplace as it stands today. (At least, as of 2019). The plans that fall under this umbrella are 401(k), 403(b), and 457(b).
IRA plans are perhaps one of the most well-known “safety nets” for retired workers. That’s due to its status as a government-created concept. It was enacted to make it easier for workers to save up their retirement funds. Depending on what you want and need, you have a wide array of choices: traditional, Roth, Spousal, rollover, SEP, and SIMPLE.
You might also hear this plan referred to as solo-k, uni-k, and one-participant-k. They have these unusual names because they are meant for business owners and their spouses only. Owners are, technically speaking, employer and employee at the same time. Suppose that you are intent on creating a sole proprietorship. If that’s the case, the catch is that you can’t grow your business. According to the IRS, other eligible employees can join the plan; the IRS enforces this mandatory rule, and trying to circumvent it is ill-advised.
A Customer Testimonial
Here is a little bit more from what Chris Copeland from Kenwood Kitchens had to say: “As well Will is working to see what else I may be able to get and take care of follow-up visits. It’s great that both of you follow up with me on this and keep me posted on what’s happening. In today’s world, great customer service seems to go unnoticed, so I wanted to reach out and say keep up the good work, and thanks! ” Thanks much, Chris!
Get Your Voluntary, Supplemental, and Health Insurance Policies with the MWE Partnership!
Are you a business looking to provide your employees with essential voluntary benefits? If so, look no further than The MWE Partnership. When you choose The MWE Partnership, you get experienced service and comprehensive voluntary benefit options that will meet all your employees’ needs. With over 17 years of experience, The MWE Partnership is your go-to provider for all your supplemental benefit needs. If you are interested in finding out how The MWE Partnership can help your business, contact us today! We encourage you to like our Facebook page and follow us on Twitter and LinkedIn for the latest voluntary benefit news!