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Tips for Business Owners on Savings for Retirement

As a small business owner, you deal with many day-to-day stresses. Saving for retirement should not have to be one.

For a lot of business owners, retirement is a blip on the radar. Starting a small business off the ground is a hassle. Once it’s running successfully, you may be hesitant to pass your legacy into the hands of someone else. This can give you the relief of achieving a successful retirement.

We are here to help alleviate those worries. In fact, we’ll let you in on a little secret..  Saving for retirement as a small business owner is easier than you think. By keeping in mind the following, you can rest assured that your business and your future will be well taken care of when you decide to retire.

Business owners retirement options!

Your first step to saving for your retirement years is to begin saving immediately. This may seem like a no-brainer; however, adding future savings at the top of your priority list is one that most business owners forget.

The reality of saving for retirement is that most people don’t do it unless they have an employer-matched 401(k) or another pension plan through their current job. For entrepreneurs or small business owners, retirement plans like these aren’t considered an option. It is important to begin saving as soon as possible. You have many savings options as a small business owner, including: Roth IRAs, solo 401(k), SEP plans, and simple retirement plans. Remember that when it comes to saving for retirement, investments are also your friend! You can even use your company’s current retirement plan to save for your own future!

Speak to a Professional who works with business owners.

Now that you know you have many options on the table, you should seek the help of a financial adviser. Retirement savings go far beyond the options we listed earlier and – depending on your goals and current budget – you may not be able to just pick any option. A financial adviser will be able to assess the current state of your business’s finances. He/She will be able to thoroughly walk you through the complex rules and laws surrounding pension plans.

Don’t Just Plan For Your Future… Execute it.

Retirement may be all about preparing for your future; however, you should also be preparing for the future of your business. What will happen to your business if you are no longer around to run it? Is it in good hands? Having a contingency plan can greatly help you prepare for retirement – and build in a safety net in case something happens to your business. What you want to save for retirement is directly tied to the financial decisions you make to protect your business. Speaking to a financial adviser can help you map out these details and figure out the best retirement savings option for you.

Set a Goal for retirement.

Why didn’t we put this as number one? The reason is because you most likely had a goal in mind already. However, after completing the first steps and assessing the realities of your financial situation and retirement options, it’s time to reevaluate your goals. You may choose to sell your business once you retire, to pass it down or to enter into a partnership. The details you discussed with your financial adviser will help you outline a retirement savings goal that you can actually meet and begin taking steps to achieve this goal. We also recommend frequently checking in with a financial planner to ensure you are on track to meet your goals.

Grow Your Business.

To increase the value of your business and it’s likelihood for success, you may want to consider growing your business by adding employees. For many business owners, this represents a shift in strategy: to ensure that you can retire comfortably, you may need to sell your business. Unfortunately, most business owners are sole proprietors, which is not always good for selling the business.

To successfully grow your business or plan to sell it, you might have to enter into a partnership or enroll outside help to manage the business so that you can focus on its growth potential. Remember: growing your business can not only ensure that your legacy survives even when you aren’t working, but will make it easier for you to save for retirement.

There Is A Retirement Option for Everybody

Small business owners frequently neglect worrying about their future in favor of worrying about the future of their business. By taking the time to map out your retirement goals and to sit down with a financial adviser, you can take on both tasks at once: you can save for retirement AND financially stabilize your business.

You’ve worked hard to start your business, now let us work hard to help you.