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ib_p03_401kplanning - Financial Example Without 401K...

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Retirement Planning and 401K Plans June 13, 2007 John Doe
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Agenda The Importance of 401K Plans Benefits of a 401K Plan Financial Example Next Steps
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The Importance of 401K Plans 401K’s are an important part of retirement planning It’s never too late to start Employers contribute matching funds Many organizations allow “accelerators” for employees 50 years of age and over
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Benefits of a 401K Your contributions are pre-tax money Your money grows tax-deferred You pay less income taxes Your money is professionally managed There are a variety of funds to invest in
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Unformatted text preview: Financial Example Without 401K contribution: Base: $50,000 401K: $ FICA: $ 6,750 Taxes: $ 11,000 (22% tax bracket) Equals $32,250 annually With 8% 401K contribution: Base: $50,000 401K: $ 4,000 FICA: $ 6,750 Taxes: $ 9,200 (20% tax bracket) Equals l $30,050 annually Savings after 10 years at 6% Next Steps Decide how much money you wish to contribute Choose from the following funds § Magellan § Fidelity § Dreyfus Enroll with your employer Set up online acess to your account Relax and watch your retirement money grow!...
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ib_p03_401kplanning - Financial Example Without 401K...

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