Retirement Plan Just As Important As Business Plan ? ? Rankin ...

MINNEAPOLIS and ST. PAUL, Minn., Sept. 6, 2012 ? /PRNewswire/ ? According to a recent report conducted by The American College, forty percent of small business owners have no retirement savings or pension plan in place. Furthermore, the study found that three-fourths of those owners have no written plan as to how they intend to fund their retirement.¹

Small business owners know the value of a solid business plan. Unfortunately, too many of those entrepreneurs neglect to place the same effort in planning for their retirement. Business owners focus so much on growing and maintaining their business, that often their own retirement is put on the back burner.

?It?s important to have personal retirement savings outside of your business because the value of that business can fluctuate significantly over the years,? says Steve Weitz, Business Banking Manager Minnesota Region for MI, a part of BMO Financial Group.? ?Additionally, having a retirement nest egg is important should the unexpected arise, such as a major health issue or needing to sell the business sooner than expected.?

Tina DiVito, Head of the BMO Retirement Institute, offers these tips for small business owners on how to effectively save for retirement:

• Take care of yourself ? Invest in yourself, not just your business. As a small business owner, the instinct is often to invest back into the business.? However, it is very important to pay yourself as well, especially when planning and saving for retirement. Relying on selling the business to fund retirement can be a risky approach that does not always work.
• Invest in an IRA and SEP ? Having a diversified financial plan, including both an IRA and SEP, is a great way to accumulate wealth outside of the business. Investments in these plans grow faster due to tax-deferred compound growth, and IRAs and SEPs with conservative holdings are effective during times of instability, offsetting the volatility of business returns. SEPs can provide great tax benefits by reducing the owner?s taxable income.
• Team of experts ? Surround yourself with a group of experts, including a financial professional who specializes in small business, an accountant, a tax specialist and a lawyer. They can offer sound advice and provide insight on how to build your retirement savings independently of your small business. A financial professional can also help develop a detailed financial retirement plan that outlines your goals and progress.?
• Explore other investment options ? Consider other investment strategies that will help build your retirement savings like investing outside of your IRA and SEP. It is also important to take precautions against the unexpected, like an illness or disability, by considering life and disability insurance.

As with any investment, you should consult with a tax advisor to determine what works best for your personal goals and financial situation.

?Although it?s tempting to concentrate solely on investing in their business, small business owners owe it to themselves and their family to have personal retirement savings to help ensure a comfortable retirement,? says DiVito.

To learn more about how to financially prepare for retirement, please visit: www.bmoharris.com/retirementinstitute

About BMO Harris Bank

Based in Chicago, BMO Harris Bank N.A. provides a broad range of personal banking products and solutions through over 650 branches and approximately 1,350 ATMs in Illinois, Wisconsin, Indiana, Kansas, Missouri, Minnesota, Nevada, Arizona and Florida. BMO Harris Bank?s commercial banking team provides a combination of sector expertise, local knowledge and mid-market focus throughout the U.S. Deposit and loan products and services provided by BMO Harris Bank N.A. Member FDIC. BMO Harris Bank^SM is a trade name used by BMO Harris Bank N.A. BMO Harris Bank is part of BMO Financial Group, a North American financial organization with 1,600 branches, and a retail deposit base of approximately $180 billion.

United States Department of Treasury Regulation Circular 230 requires that we notify you that this information is not intended to be tax or legal advice. This information cannot be used by any taxpayer for the purpose of avoiding tax penalties that may be imposed on the taxpayer. This information is being used to support the promotion or marketing of the planning strategies discussed herein. BMO Harris Bank, a part of BMO Financial Group and its affiliates do not provide legal advice to clients. You should review your particular circumstances with your independent legal and tax advisors.

About the BMO Retirement Institute

The BMO Retirement Institute, a part of BMO Financial Group,? was established in 2008 in Canada to provide thought-provoking insight and financial strategies for individuals planning for, or currently in, their retirement years.

¹The American College, State Farm^? Center for Women and Financial Services, ?Financial Goals, Concerns and Actions of Women Business Owners,? Feb. 24, 2012.

SOURCE BMO Harris Bank

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Article source: http://www.sacbee.com/2012/09/06/4794442/retirement-plan-just-as-important.html

Source: http://www.rankinrealty.net/2012/09/retirement-plan-just-as-important-as-business-plan/

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