Retirement savings options for high income earners
High income earners often find themselves in a bit of a quandary when it comes to retirement planning. Of course, this does not mean that high income earners should shy away from contributing to k s or other employer-sponsored retirement plans.
The more a person can contribute to a tax-deferred plan, the better. But for high income earners, saving enough so that you can replace your income in retirement means turning to retirement savings options for high income earners methods and savings vehicles to reach your goals. Here are three potential options. The tips laid out above are not exhaustive for high income earners, and they leave out those who are self-employed or own a business.
In those cases, there are retirement plans like SEP IRAs and self-directed k s that have much higher contribution limits than traditional retirement plans. In any case, it is important for high income earners not to feel limited by the retirement plan options that are right in front of you. There are plenty of options to explore to save and grow your retirement assets in a tax efficient way. To learn more about what you can do to save more and invest your assets in a tax efficient manner, call one of our Wealth Managers today at You can also email us at wealth wrapmanager.
Retirement Planning Saving for Retirement. WrapManager's Wealth Management Blog. Retirement and financial planning can essentially be broken down into three phases: Taxable Brokerage Account — Capital gains tax rates may change over time and from administration to administration, but one retirement savings options for high income earners is not likely to ever change: The key to managing a taxable brokerage account is to seek ways from year to year to offset your capital gains with losses, which you can do dollar for dollar under the current laws.
In some cases, you can also use capital losses in your brokerage account against ordinary income. In many cases, you can make this conversion with little or no tax upon conversion.
After-tax contributions to a k work a lot like non-deductible contributions to an IRA — your contributions are after-tax dollars, but retirement savings options for high income earners earnings grow tax-deferred. Upon withdrawal, the earnings get taxed at ordinary income. In some cases, it may just be better to contribute to a taxable brokerage account, since the capital gains rate is in many cases lower than the ordinary income rate for high income earners.
You should consult a tax professional for advice on what works for your situation. But also keep in mind that for those looking to eventually convert these after-tax contributions to either a Roth k or a Roth IRA, making extra contributions to a k may be a smart move. Explore More Retirement Savings Options The tips laid out above are not exhaustive for high income earners, and they leave out those who are self-employed or own a business.
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I may seem a little under ambitious here, but I would be fairly happy making ?10 to ?30 a day on a plausible system, ?100 a day would well a dream come true. Can anyone recommend any such systems.
Neil Waltons bit about laying the field sounds interesting is there any systems or info retirement savings options for high income earners this. As for the taxman I would relish the chance to lock horns over winnings, since that nasty bloke in the bowler hat bankrupted me without a fair fight.
Thank you all for your comments it has been extremely interesting.