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March 2017  Volume 15, Number 3        
 

This Just In ...

Small Business Owners Neglecting Their Own Retirement

Most small business owners are not financially prepared for retirement, and 75 percent have less than $100,000 saved, according to a new report from BMO Wealth Management.

The report notes self-employed individuals, if they withdraw $50,000 annually, will need $1.1 million for their savings to last from age 65 to 90. However, the report found only 4 percent of owners of businesses with fewer than 500 employees have saved $1 million or more. Twelve percent have $100,000 to $250,000 in retirement savings, 5 percent saved $250,000 to $500,000 and 4 percent saved $500,000 to $1 million.

“Many business owners are banking on selling their businesses to retire, but that is a very risky proposition,” Pamela Yellen wrote in an Entrepreneur article. Yellen recommends small business owners need a “Plan B” for retirement. The authors of the BMO report wrote, “The importance of owning diversified retirement savings personally and outside of your business cannot be emphasized enough, given the risks and challenges in converting business assets into funds that can be used for your retirement.”

Small business owners can choose from several types of retirement plans, including SEP-IRAs, SIMPLE-IRAs, SIMPLE 401(k)s,small-business owner 401(k)s, traditional 401(k)s, and more. Each has advantages and disadvantages—please call us to learn more.

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In this issue:

This Just In...

House Votes to Clear Way for Repeal of Obamacare

How Wellness Programs Improve the Bottom Line

Trends in Workplace Benefits in 2017

Congress Reexamines Repeal of Cadillac Tax

 

 


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