A business owner with just a handful of employees has several qualified retirement plans to choose from. But you may need to salt away more later in life than a typical defined contribution plan—like a Simplified Employee Pension (SEP) or Savings Incentive Match Plan for Employees (SIMPLE)—will allow.
Strategy: Set up a Section 412(i) plan. This little-noticed type of defined benefit plan can help you meet your objectives without costing an arm and a leg to cover other employees.
A 412(i) plan is funded entirely through purchases of annuities or certain other insurance products. Because the rate of return guaranteed by the insurer is normally lower than the rate available through other defined benefit plans, you can contribute more to a 412(i) plan than you can with a regular pension plan.
Here’s the whole story: The 412(i) plan option could be a good alternative for late bloomers who weren’t able to save enough for retireme...(register to read more)