Is It Right For You?

You've been running your business for a long time and have watched it thrive and grow successfully. Now, you're in the home stretch. You know it's not too late to start saving, and you know that you have to play some serious catch-up to get on track with your retirement savings—but fast.

You're earning a high annual salary of at least $225,000 and are age 50 or over. You're planning to work for at least another five, maybe 10 years, and until then are prepared to contribute at least $60,000 a year to a plan that promises you a guaranteed annual distribution amount once you retire.

The Tax Benefits of a Personal Defined Benefit Plan

The contributions you make are generally 100% tax-deductible within IRS limits.

Additional Advantages

• Maximize your savings for retirement. If you're nearing retirement, a personal defined benefit plan allows you to grow your savings quickly. For 2009, the maximum annual lifetime benefit you may target is $195,000. The actual amount you'll be required to contribute annually is based upon a variety of factors such as your age, income, and when you plan to retire.
• Help with recordkeeping and plan administration. Your custodial firm will make the annual actuarial calculations as well as prepare IRS Form 5500 or 5500-EZ on your behalf. It will also calculate eligible distributions when plan participants retire or leave the company.

Your Next Step

Contact a Key Investment Team advisor to help determine if a Personal Defined Benefit Plan is right for you. Be sure to establish your plan by December 31 (or the end of your fiscal year). Please note that this plan can take up to three months for set up, so you'll want to start early.

Key Investment Team does not provide tax advice. The structuring of a retirement plan can have significant tax consequences on you and your business. Investors should consult with their tax professional to determine the tax implications of this retirement plan structure.