Doug Tashma, RMC Group’s Executive Vice President of Operations,
explains how you could tell your clients that they can make substantially higher contributions to a qualified retirement plan AND completely eliminate market risk – all on a tax favored basis? Watch to find out!
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Contact RMC Group at 239-298-8210 to get a plan started today!
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Email Address: rmc@rmcgp.com
Phone Number: 239-298-8210…(read more)

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Make Substantially Higher Contributions to a Qualified Retirement Plan!

When it comes to planning for retirement, many individuals dread the thought of not having enough funds to live comfortably during their golden years. However, there is a strategic way to maximize your retirement savings and ensure a secure financial future – by making substantially higher contributions to a qualified retirement plan.

A qualified retirement plan, such as a traditional individual retirement account (IRA) or a 401(k) offered by your employer, allows you to save money for retirement while benefiting from tax advantages. By increasing your contributions, you can take advantage of these benefits and boost your retirement savings significantly.

So, how does one make substantially higher contributions to a qualified retirement plan? Here are some key strategies to consider.

1. Take Full Advantage of Employer Matching Contributions
If your employer offers a 401(k) plan with matching contributions, make sure you contribute at least enough to get the maximum match. This is essentially free money that your employer is offering as a benefit, so it’s wise to take full advantage of it. Consider increasing your contribution to the maximum allowable limit to ensure you receive the maximum matching contribution.

2. Make Catch-Up Contributions
If you’re age 50 or older, you’re eligible to make catch-up contributions to your qualified retirement plan. These additional contributions are designed to help older individuals “catch up” on their retirement savings. For example, in 2021, the catch-up contribution limit for a 401(k) plan is $6,500, in addition to the regular contribution limit of $19,500. By making catch-up contributions, you can substantially increase your retirement savings in a shorter period.

3. Consider a Roth IRA Conversion
If you have a traditional IRA, you can convert it to a Roth IRA to potentially make substantially higher contributions to your retirement plan. A Roth IRA allows your contributions to grow tax-free, and qualified withdrawals are tax-free as well. However, keep in mind that converting a traditional IRA to a Roth IRA has tax implications, as you’ll have to pay taxes on the converted amount. Consult a financial advisor or tax professional to determine if this strategy is suitable for your specific situation.

4. Reduce Expenses and Allocate the Savings to Your Retirement Plan
One effective way to make higher contributions to your retirement plan is to cut back on unnecessary expenses. Analyze your monthly budget and identify areas where you can potentially reduce spending. Whether it’s eating out less frequently, cancelling unused subscriptions, or finding cheaper alternatives for certain services, allocating the savings towards your retirement plan can significantly increase your contributions.

5. Increase Your Income
Another way to make substantially higher contributions to your retirement plan is to increase your income. Explore opportunities for additional income streams, such as freelancing, part-time work, or monetizing a hobby or passion. By earning more, you’ll have more funds available to contribute towards your retirement savings.

In conclusion, making significantly higher contributions to a qualified retirement plan is a proactive step towards securing a comfortable future. By taking advantage of employer matching contributions, making catch-up contributions, considering a Roth IRA conversion, reducing expenses, and increasing your income, you can boost your retirement savings and enjoy a worry-free retirement. Start implementing these strategies today and set yourself on the path to financial freedom!