Question

John Smith age 60 and his wife Sharon age 59 are small business owners. They have only one employee Jennifer age 25. John and Sharon have spent the past 20 years building the business into a stable and profitable enterprise with strong and dependable cash flow. They have not saved anything for retirement and would like to adopt a retirement plan that will allow them to save as much as possible for retirement and also to save money on their taxes. Which of the following plans would you recommend they consider?

1. Simplified Employee Pension Plan
2. 457(b)
3. Age-based Profit Sharing Plan
4. Defined Benefit Pension Plan

  

1

   

2

   

3

   

4

Answer 1