Forgot Login ID?
Forgot Password?
  • Forgot Login ID?
    Forgot Password?
  • Personal
    • Personal Checking
      • Personal Checking
      • Order Checks
      • $5 Allowance
    • Personal Lending
      • Personal Lending
      • Personal Loan Rates
    • Mutual Benefits Program
      • Mutual Benefits Program
      • Mutual Benefits Member Portal
      • Tiers and Benefits
      • Local Partners
      • Mutual Benefits Newsletters
      • Personality Quiz
    • Personal Savings, Money Markets, CDs & IRAs
    • Home Lending
      • Home Lending
      • Home Equity Lines & Loans
      • Mortgage Lending Specialists
      • First Time Homebuyers
      • Mortgage Assistance Programs
      • Home Buying Road Map
      • Home Lending Rates
      • Calculators
    • Online, Mobile & Telephone Banking
      • Online, Mobile & Telephone Banking
      • Telephone Banking Guide
      • Video Demos
    • Health Savings Accounts
    • Overdraft Programs
    • Deposit Rates
    • Safe Deposit Boxes
  • Business
    • Business Checking & Savings
      • Business Checking & Savings
      • Deposit Rates
    • Lending
      • Lending
      • Medical Professional Practice Lending
      • Commercial Loan Meeting Checklist
      • Business Plan
      • Business Loan Application
    • Online, Mobile & Telephone Banking
      • Online, Mobile & Telephone Banking
      • Telephone Banking Guide
      • Video Demos
    • Branch Management Team
    • Business Team
Merrimack County Savings Bank
  • Resources
    • Financial Education
    • News
    • Routing Number
    • Banks Never Ask That
    • Calculators
      • College Savings Calculator
      • Loan Calculator
      • Mortgage Calculators
      • Retirement Calculator
      • Savings Calculator
  • About
    • Contact Us
    • Careers
    • Community Involvement
      • Foundation Application
    • Directors
    • History
    • Leadership Team
    • Locations
  • 800.541.0006

    • Online Banking Video Demos
    • Calculators

"We make a living by what we get, but we make a life by what we give." - Winston Churchill

Financial Education

Financial Education Center > Investing For Retirement
Keogh Plans
  • Introduction
  • Can You Have Both a Keogh Plan and an IRA?
  • Defined Contribution or Defined Benefit?

Introduction

What if you're self-employed and you want to place some of your earnings in a tax-deferred retirement account, but you don't want to limit your contribution to $6,000 in an IRA in 2020 ($6,000 in 2019). You'd like to save considerably more. Do you have the same opportunity available to you as employees who are covered by corporate retirement plans? The answer is yes.

  • Connect with a Financial Advisor


Keoghs allow unincorporated, self-employed business owners (sole proprietors and partnerships) to make tax-deductible contributions and receive the same tax advantages as corporations. Unlike IRAs, Keoghs are still tax-deductible if you're covered by an employer plan. Suppose you work as a part-time freelance writer in addition to your regular, full-time job. You can use your freelance writer income to open a Keogh. A Keogh plan lets you accumulate savings in a private retirement plan that supplements your pension and Social Security.


Opening a Keogh is a bit more complicated than opening an IRA. You must have a plan document that is approved by the IRS. The plan document describes the type of Keogh plan it is and how contributions are determined. You can have either a defined benefit or defined contribution (money purchase or profit-sharing) plan. Your maximum contributions will depend upon the type of plan you establish.


IMPORTANT NOTE: If you are covered by a qualified employer retirement plan, the total annual contributions to defined contribution plans in 2020 cannot exceed 100% of your compensation or $57,000 ($56,000 in 2019), whichever is less. If you also have a defined benefit plan, a separate limitation applies; this benefit limitation of $230,000in 2020 ($225,000 as 2019) is the maximum annual benefit that may be paid from the plan. The actual contribution to a defined benefit plan will depend on the benefit provided under the plan, the participant's age and years of service with the employer, and the rate of return earned on plan assets.

  • Next
Share Article:
Add to Facebook Add to Twitter Add to LinkedIn Add to GooglePlus

Not FDIC Insured Not Bank Guaranteed May Lose Value
Not a Bank Deposit Not Insured by Any Federal Government Agency

Meeting with NHTrust Team is without obligation or cost.

NHTrust is a trade name of the New Hampshire Trust and Wealth Management Company. Brokerage services are offered through INFINEX INVESTMENTS, INC., Member of FINRA/SIPC. Investment and insurance products are subject to investment risk, including the possible loss of value. Products and services made available through Infinex are not insured by the FDIC or any other agency of the United States and are not deposits or obligations of nor guaranteed or insured by any bank or bank affiliate. Infinex and NHTrust are not affiliated.

Find Someone To Help
  • Connect with a Financial Advisor
Free Quick Guides
  • Retirement Plans for Self-Employed
  • Additional Guides
Your Financial Checklist
  • Create Checklist

PO Box 2826
Concord, NH 03302-2826
603.225.2793
800.541.0006
Telephone Banking: 888.224.6272
NMLS#433938

© 2021 Truebridge, Inc.

  • Personal
    • Branch Management Team
    • Personal Checking
    • Personal Savings, Money Markets, CDs & IRAs
    • Health Savings Accounts
    • Overdraft Programs
    • Deposit Rates
    • Online, Mobile & Telephone Banking
    • Home Lending
    • Personal Lending
    • Mutual Benefits Program
    • Safe Deposit Boxes
  • Business
    • Business Team
    • Business Checking & Savings
    • Lending
    • Online, Mobile & Telephone Banking
    • Expanded Business Solutions
    • Mutual Benefits Business Partner Program
  • Resources
    • Financial Education
    • Calculators
    • Routing Number
    • Newsletter
  • About
    • Careers
    • Community Involvement
    • Directors
    • History
    • Leadership
    • Privacy & Security
    • Statement of Condition
    • Values
    • Locations
  • Facebook
  • Twitter
  • LinkedIn
  • Personal
    • Personal Checking
      • Personal Checking
      • Order Checks
      • $5 Allowance
    • Home Lending
      • Home Lending
      • Home Equity Lines & Loans
      • Mortgage Lending Specialists
      • First Time Homebuyers
      • Mortgage Assistance Programs
      • Home Buying Road Map
      • Home Lending Rates
      • Calculators
    • Online, Mobile & Telephone Banking
      • Online, Mobile & Telephone Banking
      • Telephone Banking Guide
      • Video Demos
    • Personal Lending
      • Personal Lending
      • Personal Loan Rates
    • Mutual Benefits Program
      • Mutual Benefits Program
      • Mutual Benefits Member Portal
      • Tiers and Benefits
      • Local Partners
      • Mutual Benefits Newsletters
      • Personality Quiz
    • Health Savings Accounts
    • Overdraft Programs
    • Deposit Rates
    • Personal Savings, Money Markets, CDs & IRAs
    • Safe Deposit Boxes
  • Business
    • Business Team
    • Branch Management Team
    • Online, Mobile & Telephone Banking
      • Online, Mobile & Telephone Banking
      • Telephone Banking Guide
      • Video Demos
    • Business Checking & Savings
      • Business Checking & Savings
      • Deposit Rates
    • Lending
      • Lending
      • Medical Professional Practice Lending
      • Commercial Loan Meeting Checklist
      • Business Plan
      • Business Loan Application
  • Resources
    • Financial Education
    • News
    • Calculators
      • College Savings Calculator
      • Loan Calculator
      • Mortgage Calculators
      • Retirement Calculator
      • Savings Calculator
    • Routing Number
    • Newsletter
    • Banks Never Ask That
  • About
    • Contact Us
    • Careers
    • Community Involvement
      • Foundation Application
    • Directors
    • History
    • Leadership Team
    • Locations
  • Contact