For most business owners, their business is their retirement plan. So, what do you think would happen if they cannot work as much as they used to, or if they could not work for a while? Let’s face it; a business may not be the best retirement plan, but it is a great funding source for one. Retirement planning determines your options in your later years. It gives you peace of mind when you retire, or when the unforeseen happens. It may also give you the option to scale back on your business and enjoy the fruits of your labor. And how about getting a tax deduction on the money that you put away for retirement?
Here are 3 reasons to consider a retirement plan:
- You receive a tax deduction for the money you contribute – this is a great way to spend business funds that will build a nest egg for the future. The more you make the more you can contribute tax-free.
- The money in your retirement nest egg grows tax deferred - this money attracts interest and grows tax-free. The sooner you are able to start putting away funds, the more years you will have to roll over your money tax-free.
- You only pay tax when you withdraw – the great news is that some of these plans allow you to borrow from them which means you can borrow money as the need arises and pay back when it’s convenient for you.
