There’s a retirement plan available for nearly everyone
Changes in the federal tax laws in recent years allow you to save more for retirement on a tax-deferred basis. As you compile your tax information, keep the following information in mind. Employer-sponsored plans: If you work for an employer who offers a pre-tax type of retirement plan, such as a 401(k), 403(b) or simple IRA, you should contribute as much as you can, especially if your employer matches a portion of your contribution. If the plan permits, you may also make catch up contributions if you are 50 or older. Speak to your financial adviser or human-resources manager to determine how you can make the most of your employers plan. Individual retirement accounts: IRAs may be useful to individuals not covered by an employers plan. Contribution limits to traditional IRAs are $4,000 for 2006 and 2007, and $5,000 for 2008 for those participants younger than 50. If you are older than 50, your limits are $5,000 for 2006 and 2007, and $6,000 for 2008. Business owners and the self-employed: Self-employed individuals and business owners can save even more for retirement. Business owners can set up 401(k) plans for their businesses, with or without profit sharing. Additionally, small owner-only businesses can set up their own 401(k) plan, which enables them to contribute even more. Qualified retirement plans: These enable you to shelter more of your earnings while saving more for retirement on a tax-deferred basis. Because no other type of savings plan offers these twin benefits, most financial professionals suggest you put the maximum allowed, or the most you can afford, into your plan. For those with multiple retirement accounts from multiple jobs, you can move those funds to a traditional IRA or an employer-sponsored plan, making it easier to consolidate your retirement dollars.Jeffrey Apps and Tracy Tutag offer securities and investment advisory services through AXA Advisors LLC (member NASD, SIPC), 1290 Avenue of the Americas, New York, NY 212-314-4600. They also provide annuity and insurance products through an insurance brokerage affiliate, AXA Network LLC, and its subsidiaries. They can be reached in the Riverwalk in Edwards at 926-0601 or email@example.com. This material is not intended as tax or legal advice. You should consult with your personal tax or legal adviser regarding your specific situation before implementing any estate or business strategy.