October has been designated “Financial Planning Month.” And for very good reason. For many people, it marks yet another quarter that has passed without much thought about the status of your financial future.
There are more than 2,700 rules that govern Social Security. A typical married couple has more than 500 possible ways in which to file for their Social Security Retirement Benefits. If you are divorced or widowed, the filing rules can be even more complex. Agents at the Social Security Administration (SSA) are prohibited from providing
What Is a SIMPLE? There are many types of employer-sponsored retirement plans. One that may appeal to small businesses and to self-employed individuals is the savings incentive match plan for employees of small employers (SIMPLE) because, as the name implies, it is easy to set up and administer, and employers are allowed to take a
What Is a “Stretch” IRA? Finding a method to leave a lasting legacy to your loved ones without increasing their tax burdens can be difficult and complicated. A “stretch” IRA may be a useful approach that can benefit your heirs for generations to come. A stretch IRA is not a special type of IRA but
What Is an IRA Rollover? If you leave a job or retire, you might want to transfer the money you’ve invested in one or more employer-sponsored retirement plans to an individual retirement account (IRA). An IRA rollover is an effective way to keep your money accumulating tax deferred. Using an IRA rollover, you transfer your
What Is a Roth 401(k)? The arena of employer-sponsored retirement plans has been dominated by 401(k) plans that are funded with pre-tax contributions, which effectively defers taxes until distributions begin. However, the recently created Roth 401(k) is funded with after-tax money just like a Roth IRA, allowing retirees to enjoy qualified tax-free distributions once they
Profit-Sharing Plans David Wray, the president of the Plan Sponsor Council of America, once said that the purpose of profit-sharing plans is “to generate goodwill and a feeling of partnership” between employer and employee. Profit-sharing plans give employees a share in the profits of a company each year and can help fund their retirements. All
Money Purchase Pension Plans A money purchase plan is a type of defined-contribution plan that is similar to a profit-sharing plan, except that the contribution amounts are fixed rather than variable. Thus, employers are required to make annual contributions to each employee’s account regardless of the company’s profitability for the year. These plans can be
What Is a 403(b) Plan? A 403(b) plan is a special tax-deferred retirement savings plan that is often referred to as a tax-sheltered annuity, a tax-deferred annuity, or a 403(b) annuity. It is similar to a 401(k), but only the employees of public school systems and 501(c)(3) organizations are eligible to participate in 403(b) plans.
Why Do People Buy Annuities? Annuities are insurance-based financial vehicles that can provide many benefits sought by retirement-minded investors. There are a number of reasons why people buy annuities. Deferral of taxes is a big benefit, and so is the ability to put large sums of money into an annuity — more than is allowed
