Retire on More Than Social Security

 by Karen Stern

 Are you sinking every dollar into your business? Not finding time to determine your retirement needs or the funds to put aside? Do you take advantage of every business-related write-off to reduce taxable income, therefore lowering your Social Security payments?

Barlow Research’s Economic Pulse Study points out that 47% of small-business owners do not intend to retire. Similarly, according to a 2010 Gallup poll, 47% of entrepreneurs will not retire until forced to do so for health reasons. And the Small Business Administration Office of Advocacy found that, on average, small-business owners who anticipate retiring will do so later (age 72.6) than traditional employees (age 68.4).
Yet there’s nothing stopping you from retiring – even at a reasonable age – if you start planning now. Good saving habits, and taking time to determine your needs, can provide the support you need to keep moving toward a retirement goal:
* Don’t procrastinate. Start today – waiting can impact your overall savings potential.
* Find an investment you cannot touch until retirement without a penalty.
* Have an amount invested automatically at regular intervals.
* Plan your investment strategy. If you can’t, find an expert who can identify the best strategy for your goals.
Once you’ve set your investment strategy, you can explore options to grow and protect your assets up to and into retirement:
* IRA (traditional/Roth)
* 401(k) (traditional/Roth)
* Long-term care insurance
* Investments (diversifying)
* Simplified Employee Pension IRA – contribute up to 25% of your net self-employed income up to $51,000
* One-participant 401(k) – individual’s contributions are similar to those with a traditional 401(k), but the business can set up a profit-sharing plan that lets it tuck away up to 25% of profits annually, not to exceed $51,000.

Karen Stern (314-983-1204 or kstern@bswllc.com) is partner in charge of BSW Small Business Services, which provides small business tax and accounting services.