Financial Planning and Investment Management Solutions for Small Business Owners

If you are a small business owner, you have substantially different financial investment needs. Many of our clients are small business owners. Working together over the years, we have developed a wide range of financial investment solutions specifically focused on a small business owner.  We work together with your accountants, tax, and legal advisors throughout the year to maximize returns, reduce risk, and reduce tax liabilities as appropriate. It’s a very different engagement and relationship compared to an individual or family financial investment planning.  In some cases, we can also work with your employees on retirement planning.

Small Business Owner Retirement Planning

More often than not, our retirement planning conversation with small business owner starts with a sensitive debate. Many small business owner clients don’t believe or don’t recognize they need a standalone individual retirement plan separate from their business. They look at their business as a source of their income and a future source of their retirement. While we sincerely hope the future will bring just that it’s not a prudent financial planning practice. It’s highly recommended that small business owners establish a separate from their business individual retirement plan and investment account.  They can immediately take advantage of tax deferral, reducing their annual tax liability while also protecting that asset from business liability.

Money Management of Business Operating Cash

Another significant difference between small business owner’s financial investment needs and general individuals or family’s investment needs is the need to manage business operating cash. Over the years, we have developed a portfolio program that allows business owners to earn a higher interest return on their operating cash while keeping their funds available.

General Investment Portfolio Management

Many of our small business owner clients have been fortunate not only to earn a great living in their small business but also to build up a savings account. Many of them want those savings accounts to grow at a higher rate but with reduced risk and a short-term investment view. They want growth, but they also want to be able to use the funds for their lifestyle. For this reason, we created a defined or structured outcome portfolio program. We use index ETF’s and derivatives, more specific options, to reduce risk while providing portfolio growth.

Traditional and Roth IRAs

The Individual Retirement Account (IRA) and Roth IRA are both forms of qualified accounts. They each carry valuable tax benefits, with the primary difference being when the tax benefit is available to you. You contribute to the Roth with after-tax dollars, meaning you have already paid the taxes upfront. As such, the Roth IRA allows a month to grow TAX-FREE with TAX-FREE withdraws. With the traditional IRA, you are contributing to the account pre-tax. Therefore, your retirement benefits are subject to taxation when you begin to collect them.

SIMPLE IRA

SIMPLE IRA is defined as a Savings Incentive Match Plan for Employees. It is essentially a company-sponsored plan, in the same way, that a 401(k) is. SIMPLE IRA allows you to contribute on a pre-tax basis considerably more to what your standard allowance is.

SEP IRA

The Simplified Employee Pension or SEP IRA is a plan that allows employers to contribute to a traditional IRA set up by the employer for themselves and their employees. Similar to SIMPLE IRA, the program will enable you to contribute on a pre-tax basis considerably more to what your standard allowance is. It’s also very flexible as SEP IRA allows an employer to skip contributions during down years. If the business isn’t doing as well for whatever reason.

The Simple 401(k)

In essence, it’s a mashup of the savings incentive match plan for employees and the regular 401(k). They’ve taken some critical elements of both and created this hybrid type of retirement account. Similar to the other programs, it will enable you to contribute on a pre-tax basis considerably more to what your standard allowance is. It also allows the owner and the employees to contribute individually and create even more considerable tax-deferred earnings.