Diapositiva 1

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Retirement Plans Undressed
What Every Business Owner
NEEDS to Know!
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Today is not the usual 401(k) talk... You are
going to hear things you have NEVER heard before.
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L I S T E N W I T H B O T H E A R S . . .
YOU, as an owner who wants to accumulate
significant toward your own retirement and
defer taxes on current income
YOU, as an employer attracting and retaining the
best talent
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A G E N D A
Undressing the 401(k) Plan
Myths and Facts
Case Studies
Summary / QA
agenda
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H O W I M P O R T A N T I S Y O U R 4 0
1 ( k ) P L A N ?
Name some sources you count on for retirement
- Home
- Business
- Retirement Plan
- Inheritance
- Other
Which of these can you control?
introduction
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H O W I M P O R T A N T I S Y O U R 4 0
1 ( k ) P L A N ?
Which of your personal assets/parts of your
business may be protected from litigation?
What aspects of employee compensation/benefits
are easily changeable when business conditions
fluctuate?
introduction
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I F Y O U C O U L D , W O U L D Y O U ?
Put 49,000 pre-tax in your own 401(k) plan each
year with 100 approval from the IRS?
Pass all required discrimination tests?
Retain your most talented employees longer?
introduction
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I F Y O U C O U L D , W O U L D Y O U ?
Provide performance incentives for staff members
who are most important to your successand be
able to change how you do it each year?
Shift company dollars from taxable bonus programs
to the tax-deductible 401(k) plan?
introduction
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I F Y O U D I D , W H A T D O E S I T
M E A N F O R Y O U ?
Accumulating 1.4 million in your individual
401(k) plan account over the next 15 years, tax
deferred.
1.4 million in 15 years
Accumulating 2.2 million in the next 20 years.
2.2 million in 20 years
Deferring over 435,000 in personal income taxes
over the next 20 years.
Assumes interest rate of 6.5
introduction
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W H Y A R E N ' T Y O U D O I N G T H I S
?
introduction
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U N D R E S S I N G T H E 4 0 1 (k) P L A N
undressing the 401(k) plan
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4 0 1 ( k ) P L A N S A T F I R S T G L A
N C E
undressing the 401(k) plan
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4 0 1 ( k ) P L A N S B E L O W T H E S
U R F A C E
Investments

Plan Document Design
Most people are never shown below the surface.
undressing the 401(k) plan
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R E S U L T S P L A I N V A N I L L A
IRS rules allow flexibility, but traditional
solutions dont include it.
Their focus is on investments (and making a
profit)!
Big companies/traditional providers choose to
avoid plan design because their profit is
derived from the investments.
undressing the 401(k) plan
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C O N S E Q U E N C E S O F P L A I N V A N
I L L A ?
Business owners are boxed in!
undressing the 401(k) plan
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T R A D I T I O N A L C H O I C E S V A N I
L L A , C H O C O L A T E O R S T R A W B E
R R Y
401(k) plans have become a commodity IRS rules
allow
undressing the 401(k) plan
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I T T A K E S T W O T O M A K E A P L
A N P E R F O R M
Financial Advisor
Retirement Plan Design
Knowledge of investment and fiduciary
responsibilities
Knowledge of tax law and plan design expertise
Investment progress to match employee and
business objectives
Customized, IRS-approved retirement plan
document
Continued evaluation of investment choices for
performance and fiduciary compliance
Continuous evaluation of plan design so that each
years solution meets businesss objectives
undressing the 401(k) plan
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MYTHS FACTS
myths facts
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G R O U P Q U I Z
Maximum amount you can save each year?
- 22,000
- 54,500
- 250,000
True/False Discrimination rules force owners to
provide the same level of benefit to all others
as they provide to themselves
True/False All retirement plan documents are
basically the same and use similar methods of
operation
myths facts
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M Y T H S A N D F A C T S M Y T H 1
I take back money every year! Low employee
participation wont allow me to have a
meaningful plan.
There are ways to predict and prevent testing
failures through plan design that allow owners to
maximize contributions.
MYTH!
FACT.
myths facts
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M Y T H S A N D F A C T S M Y T H 2
Everyone knows that owners max out at only
16,500 per year.
Owners can save up to 49,000 in 2010,
including Their 16,500 401(k) deferral.
MYTH!
For those age 50 and older you can receive
an additional 5,500.
FACT.
myths facts
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M Y T H S A N D F A C T S M Y T H 2
Everyone knows that owners max out at only
16,500 per year.
Employer Contributions! 401 (k) deferral
49,000 total tax deferred 54,500 for
those over 50
IRS Allows 49,000!!!
myths facts
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M Y T H S A N D F A C T S M Y T H 2
Only a custom plan allows the maximum to be
reached efficiently.
Owners 83 of every 1.00 contributed.
Employees 17
myths facts
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M Y T H S A N D F A C T S M Y T H 3
It is illegal to treat employees differently in a
401 (k) plan.
Custom plan documents allow different treatments
for different people.
MYTH!
Owners may select individual employees and give
them more without having to give more to the
newer and unproven staff members.
FACT.
myths facts
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M Y T H S A N D F A C T S M Y T H 3
D I S P E L L E D
I can reward individuals who are important to my
business!
Give unproven staff members the minimum required.
Give your star performers more!


myths facts
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M Y T H S A N D F A C T S M Y T H 4
Once an initial approach is in Place, youre
stuck for good.
Customized plan designs allow patterns and
methods to be changed on a yearly basis to meet
owners objectives as circumstances change
without amending the plan document!
MYTH!
FACT.
myths facts
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M Y T H S A N D F A C T S M Y T H 4
D I S P E L L E D
HAVE A PLAN THATS TAILOR-MADE EVERY YEAR!
Changes?
NO NEED TO PANIC...
myths facts
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M Y T H S A N D F A C T S M Y T H 5
There is no way to improve my current design. I
already shelter the maximum it is as good as it
is going to get
Receiving 70 of all contribution dollars paid
into your plan is good fine tuning the design
may allow 93!
MYTH!
FACT.
myths facts
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M Y T H S A N D F A C T S
Let me dispel your myth...
Prepare for Retirement
(speed accumulation)
(reward individuals)
Attract Retain Talent
Maximize Tax Deferral Opportunity
(defer till death)
(help for family businesses)
Succession Planning
myths facts
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W H O I S A N I D E A L C A N D I D A T E
F O R A C U S T O M I Z E D P L A N D
O C U M E N T / D E S I G N ?
1.
Owners or partners earning 200,000 or more per
year
Owners or partners already making
employee contributions (such as matching employee
401 (k) deferrals)
2.
3.
Owners or partners who wants to maximize tax
deferred savings
4.
Owners or partners who want to reward select
employees
5.
Fewer than 200 employees
myths facts
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C A S E S T U D I E S
is this for me?
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G R E G S S T O R Y
45 years old
Taking over the family business
25 employees
Mom (79 yrs. old) still working in business
part-time
Gregs W-2 between 200,000 250,000 each year
Gregs pain point plan limits what he can
shelter
is this for me?
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G R E G ' S S T O R Y
is this for me?
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G R E G ' S S T O R Y B O T T O M L I N E
Custom Plan
Plain Vanilla
No Plan
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49
71
is this for me?
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S U E S S T O R Y
52 years old
Built a successful business over the past 20
years
100 employees
6 8 key executives earning gt 110,000
Annual W-2 for Sue 320,000
Sues pain points - employees dont value the
plan - Sues restricted in her own savings
is this for me?
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S U E ' S S T O R Y
is this for me?
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S U E ' S S T O R Y B O T T O M L I N E
Custom Plan
Plain Vanilla
No Plan
60
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82
is this for me?
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S U E ' S S T O R Y C O N T I N U E D
is this for me?
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M A R K S S T O R Y
60 years old
30 employees
Landed a 10-year contract, guaranteeing
increased income
Marks annual income will exceed 450,000 each
year
Marks pain point - I need a tax shelter! -
54,500 per year is not enough
is this for me?
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M A R K ' S S T O R Y
is this for me?
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M A R K ' S S T O R Y B O T T O M L I N E
Custom Plan
Plain Vanilla
No Plan
60
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92
is this for me?
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SUMMARY / QA
summary / qa
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K E Y P O I N T S
90 of 401(k) plans
PLAIN VANILLA
key points
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K E Y P O I N T S
The allows much more
flexibility
Banana Split
key points
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Lori Gordon
Principal CEO
C E L L 2 1 5 - 3 5 9 - 5 5 2 0
O F F I C E 2 1 5 - 2 2 2 - 5 0 0 0
L G O R D O N _at_ M A N D . C O M
W W W . M A N D . C O M
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