Archive for the ‘Retirement Plan’ Category
Strengths and Weaknessess of 401K Plan
There are strengths and weaknesses for everything in this world. This is also applicable for tools for creating the retirement plan. If you are an employee and working in certain employer than you should check detail about the policies that applicable in this company.
The strengths about this safe harbor 401k is a good solution for certain company with the condition that they cannot pass the anti discrimination test. This means that even though the company has specific condition but still they can help their employees to make the retirement plans. The weakness of this plan is not the best solution for all companies, but only for certain kinds of companies.
The strengths of this 401k plan are numbers, like the tax differed for the contribution and income of 401k. This means that you must pay the tax only if you want to withdraw the 401k account. This will make you save more money and get the chance to pay less tax. Strengths are the freedom for employees to decide how much amount of wages that they are willing to be deducted by the employers. The weakness is that employees must carefully pay attention of the vested schedule; otherwise employee will fail to get any retirement plan. And the other is that the strict rules about the money of 401k that you might borrow.