Quality retirement plan benefits can help your business recruit and retain top notch employees, but it can often be confusing when you’re shopping for the right plan. One of the most attractive plan options for small to mid-sized businesses is a SIMPLE 401(k).A SIMPLE 401(k) plan or Savings Incentive Match Plan for Employees are some of the more cost-effective retirement plans offered to smaller businesses. These plans are typically held under less regulatory scrutiny than regular 401(k)s and are only permitted for businesses with 100 employees or less. Note: rules surrounding SIMPLE 401(k)’s prevent employers from offering other types of retirement-savings vehicles to their employees.Taking advantage of employer contributions is a great incentive to help employees boost their retirement savings. SIMPLE 401(k)s offer safe harbor contributions, which requires employers to make fully-vested contributions, whether or not the employee contributes to the plan.With SIMPLE 401(k) plans, employer contributions are limited to a dollar-for-dollar matching contribution up to 3 percent; or a non-elective contribution of 2 percent of pay for each eligible employee. No other employer contributions can be made to a SIMPLE 401(k) plan.Like other 401(k) plans, the SIMPLE 401(k), the contribution is invested pre-tax. However, SIMPLE 401(k)’s contributions are immediately fully-vested, whereas traditional 401(k)s typically may not be fully vested until a later date. Key differences between SIMPLE 401(k) and SIMPLE IRABoth SIMPLE 401(k)s and SIMPLE IRAs are tax-deferred retirement savings accounts for employees of small businesses. Some of the key differences between the two plans are that SIMPLE IRAs have different match options for employers, while with SIMPLE IRAs, employers can elect to reduce contributions to 1 to 3 percent. SIMPLE 401(k)s allow participants to take loans, SIMPLE IRAs do not.Maximum contributionsSIMPLE 401(k) contribution maximums contribution limits are significantly lower than the maximum amount allowed in other retirement-savings vehicles. In 2019, the maximum amount employees can contribute to a SIMPLE 401(k) is $12,000, while the annual limit of a traditional 401(k) is $19,000 in 2019. Today, there are more quality benefit options than ever before. To learn more about SIMPLE 401k(s) or to carefully weigh all of your options to find the retirement plan that best fits your business’ needs, contact Rubin Wealth Advisors at info@rubinwa.com.
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Matching Your Risk and Return: A Personalized Approach for Maximizing Your Financial Success
At Rubin Wealth Advisors, we believe that understanding your risk tolerance is the key to maximizing your financial potential. Traditional methods of categorizing risk with vague labels like conservative, moderate, or aggressive often lead to confusion. These terms can mean entirely different things to different people, which creates misalignment between your expectations and your investment strategy. That’s where problems can arise—and where opportunities can be missed.
We take a different approach. By using a precise, quantitative system to determine your Risk Number, we help you make informed decisions that directly benefit you. Your Risk Number is more than just a score; it’s a powerful tool that helps guide your financial strategy. If your Risk Number is 64, for example, both you and our team will know exactly what level of risk that involves and how it relates to potential returns. The guesswork is gone, replaced by clarity and confidence.
Here’s where it really benefits you: Understanding your Risk Number not only ensures that your portfolio is aligned with your comfort zone, but it also increases your chances of achieving a higher risk-adjusted rate of return over time. By matching your investments to your specific risk profile, you’re better positioned to optimize returns without taking on unnecessary risk—especially over a 3-5 year period, where market fluctuations can test even the most seasoned investor.
The process is simple and designed to serve your best interests. In just a few minutes, we’ll walk through a short conversation to determine your Risk Number. From there, we’ll craft an investment portfolio tailored specifically to you, ensuring that the level of risk is appropriate for your goals. This isn’t about avoiding risk entirely; it’s about taking on the right amount of risk so you can achieve the returns you need while remaining confident in your strategy.
By aligning your portfolio with your Risk Number, you gain the peace of mind to handle market volatility. You’ll know exactly how much downside risk is possible and what kind of upside you can expect. For example, a portfolio with a Risk Number of 64 might have a potential downside of -10% over six months but offers a possible 15% gain. This range helps you stay calm during downturns because you’ve already accounted for them, and it positions you to benefit when the market performs well.
We also stress-test your portfolio in various market conditions—such as economic downturns or inflation spikes—to ensure you’re always prepared. This proactive approach ensures your investments stay aligned with your risk tolerance, giving you the best chance for success regardless of what happens in the markets.
How does this benefit you? Managing risk properly allows you to maximize returns without exposing yourself to more risk than necessary. Over time, this careful balance increases the likelihood that you’ll achieve your financial goals—whether that’s building wealth, preparing for retirement, or preserving your assets.
At Rubin Wealth Advisors, a Boca Raton financial advisor, we’re committed to helping you achieve higher risk-adjusted returns. As a licensed fiduciary, we specialize in guiding clients through personalized wealth management strategies, ensuring your investments align with your long-term goals. Let’s work together to discover your Risk Number and build a strategy that sets you up for success over the next 3-5 years and beyond. Contact us today to get started.