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How to Include Retirement in Your Business Planning

January 28th, 2010 :: Thursday Bram

As a business owner, retirement often seems like something that other people do. After all, you’ve got your own company — you’ve built it up from the ground, so why would you ever want to leave it? And, on the off chance that you decide to retire, you can always sell your business and retire on the proceeds. But the fact of the matter is that retirement planning can play an important role in your business planning. It can offer opportunities to minimize your tax burden, build additional assets and make sure that if you do find yourself ready to retire down the road, you’ll be in a comfortable position to do so, no matter what.

Adding Retirement to Your Business Planning

There are a wide variety of retirement accounts created by the government to encourage everyone to save for retirement, even if you don’t have an employer offering you a 401(k) plan. But it’s not always clear which plans are best for a business owner — there are all sorts of rules and regulations based on how much you earn, how much you want to contribute to your account and other factors. It’s worthwhile sitting down with someone who can walk you through your options. Rather than a financial planner, though, a CPA is probably your best option.

A CPA can tell you not only about how you can save money towards your retirement, but can also help you determine how you can best benefit your business with your retirement plan. For instance, if your tax burden is significant, opening a tax-advantaged retirement account can help you reduce the taxes you’ll need to pay come April 15th. Your CPA can also help you decide how much you want to save, from the point of view of your business. Because a retirement account is not nearly as liquid as other savings options, it is important to make sure that you have the necessary cash flow to keep your business healthy now, as well as plan for the future.

With the option to open retirement accounts online through many banks and brokers, you can often keep expenses to a minimum: you’re likely already working with a CPA who knows your business well, so you won’t need to find a financial planner in addition. Online account management tools bring the costs of operating a retirement plan to a minimum, as well.

It’s Not Just Your Retirement at Stake

If your business employees anyone, it may be worth looking into retirement options that you can help them with. Your CPA may be able to direct you to options that not only help out your employee, but offer you a benefit as well — offering a retirement plan can be an alternative to offering a raise or a bonus to that employee and may have a lower final price tag. You may also be able to minimize overall costs if you’re already opening a retirement account for yourself.

Photo — Chispita_666

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View Comments to “How to Include Retirement in Your Business Planning”

  1. BizSugar.com says:

    How to Include Retirement in Your Business Planning…

    Retirement planning can play an important role in your business planning. It can offer opportunities to minimize your tax burden, build additional assets and make sure that if you do find yourself ready to retire down the road, you’ll be in a comfortab…

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