Save Taxes With a Cash Balance Plan

<p class="s5">In this episode, Corey and Rachelle breakdown cash balance retirement plans.  What are they and are they a good fit for you?</p> <p class="s5">What the heck is a cash balance plan?</p> • Another pre-tax retirement plan, meaning you do not pay taxes on the money you deposit now, but you do pay taxes on withdrawals in the future. • Many pre-tax retirement plans are defined contribution plans (401k, IRA, SEP) meaning that there is a specific contribution amount. • Cash balance plans are different because the goal is to provide a “defined benefit” similar to an old-school pension. • Many people terminate the plan and roll the balance into an IRA instead of using them like a pension. <p class="s5"> </p> <p class="s5">You can potentially put a LOT of money into them, but you can’t set them up just anywhere.  A cash balance plan may be a good fit for you if:</p> • You are self-employed and want to contribute more to retirement than the IRS plan maximum for a 401k or SEP IRA. • You are a business owner who wants to contribute more to retirement AND you don’t mind setting aside some funds for your employees as well. <p class="s5"> </p> <p class="s5">There are lots of rules with these and costs as well.  It can be a great way to save a lot of money for retirement while saving on taxes, but proceed cautiously and learn as much as you can first.</p> <p class="s5">For more financial planning tips from Corey and Rachelle, find them on social media! LinkedIn: <a href='https://www.linkedin.com/in/coreyjanoff/'>@CoreyJanoff</a> and<a href='https://www.linkedin.com/in/rachellevanderzanden/'> @RachelleVanderzanden</a>; Instagram:<a href='https://www.instagram.com/coreyjanoff/'> @CoreyJanoff</a> and <a href='https://www.instagram.com/vanderzandenrachelle/'>@VanderzandenRachelle</a>; and Twitter: <a href='https://twitter.com/coreyjanoffcfp'>@CoreyJanoffCFP</a> and<a href='https://twitter.com/rachellefinance'> @RachelleFinance </a></p> <p> </p>