There is a lot to know about retirement plans. It’s good to have a ‘big picture’ view of all the possible retirement plans. So, I wanted to take a moment to categories the different types of plans that are available to private employers and individuals in the United States.
Qualified Plans
These plans are subject to Code 401 (a) and are subject to more rules and controls by the government than other plans.
- Defined benefit pension plan
- Cash Balance pension plan
- Money purchase pension plan
- Target benefit pension plan
- Profit sharing plan
- 401(k) plans (Roth and Traditional)
- Stock bonus plans
- Employee stock ownership plans (ESOP)
Tax Advantaged Plans
These plans have less burdensome than qualified plans and offer good tax advantages but there are more limits in terms of total tax savings.
- SEP IRA
- SIMPLE IRA
- 403b plans
Non-Qualified Plans
These plans are less tax advantaged but there is more control as to which employees you can select to participate.
- Deferred Compensation Plans
- 457 Plans
Let me know if you’re interested in hearing more about these plans and how they might apply to your business or personal situation.