Putting It All Together - Merrimack County Savings Bank Test

Financial Education Center > Investing For Retirement

Retirement Investments

Putting It All Together

Saving for your future is a process, not an event. It is not something that you do once and forget about; it is a continual process of taking action: planning and doing, maintaining and balancing your priorities, and re-evaluating and making changes.

Connect with a Financial Advisor

The bottom line is that it is up to you to plan for your retirement. Company plans are a great start, but it is up to you to build a retirement fund to live the lifestyle of your dreams. If you or your spouse has a business, it is up to you both to provide for your retirement by setting up your own retirement plans.

Following is a review of various retirement plans and strategies. [Note: For all Keogh plans listed below, they are qualified plans, so unless it is a profit sharing plan that allows for in service distributions, hardship or loans, the only distributable events are termination of employment, retirement, death, or disability].

Plan/Strategy	Best for	Early Withdrawal
401(k)'Profit Sharing	Employees who qualify^3,7	Depends on the plan2,4
IRA	Those who don't have company pension plans or who have put the pre-tax maximum into their company plans	Always permitted^2,5
SEP	Self-employed person who is a sole proprietor^1,7	Always permitted^2,5
SIMPLE PLAN	Employers with 100 or fewer employees who earned $5,000 during the preceding year^{7, 10}	Depends on plan
PROFIT-SHARING KEOGH	Small-business owner who is funding a plan for himself and employees. Contributions are discretionary.^1,7	Depends on plan2,6
MONEY-PURCHASE KEOGH	Small business owner who is funding a plan for himself and employees. Contributions are required to be made each year.^1,7	Depends on plan2,6
DEFINED BENEFIT KEOGH	Self-employed person nearing retirement who needs to fund a larger retirement benefit^1,7	^{Depends on plan2,6}
VARIABLE ANNUITY	Someone who has put the maximum into other plans and who won't need the money for at least 10 years⁸	Always permitted^2,5
FIXED ANNUITY	Someone who has put the maximum into other plans, prefers a fixed rate of return and who won't need the money for at least 10 years⁸	Always permitted^2,5
CASH-VALUE LIFE INSURANCE	Someone who has put the maximum into other plans, needs additional insurance coverage, and who won't need the money for at least 10–12 years⁸	Permitted by surrendering your policy⁴
NONQUALIFIED DEFERRED COMPENSATION	Everyone who qualifies⁹	Generally, only for hardship, but depends on plan
TAX EXEMPT INVESTING	Individuals who are in at least the 25% federal marginal income tax bracket	Always permitted
Notes: Small-business owners fund the SEPs and Keoghs of their employees. Amount of withdrawal is subject to 10% income tax penalty (if applicable), except in case of death or disability. Matching contributions—Anywhere from 0% to 100% of percentage of employee's contribution, but typically anywhere up to 6% of salary. Loans may be permitted. Loans not permitted. Loans may be permitted. Tax break on contributions and earnings. No tax break on contribution, earnings grow tax-deferred. Taxes postponed on deferred earnings. Matching contributions required—up to 3% of employee's wages or $6,000, whichever is less.

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.