Recently, I went to a talk on retirement plans for small business by Rhonda Porter, a financial planner for Merrill Lynch. She had some excellent advice for planning for retirement small business owners, sole proprietors and independent consultants.

Although, you may love being a small business owner, you’ll probably want to retire at some point. Small businesses are usually concentrating on running and growing their business and don’t have time to run a retirement program themselves as well as their employees. Retirement planning is especially easy to forget if you’re transitioning from the corporate world, where HR takes care of this, to the small business world where you have to take care of it yourself. A financial consultant can help share this burden. Financial consultants are just as important to your business’s success as other professionals that you current work with such as an accountants, lawyers, etc.

You also might have a retirement plan but it might be underfunded or not optimized for current market conditions. Every business is unique and requires the right retirement plan for the needs of the business. Even a one person business can use the help of a financial planning specialist.

There are many options that can be confusing: 401K, IRA, defined benefit plans, non-profit 403(b), Profit Sharing, Simplified Employee Pension(SEP) and Savings Incentive Match Plan for Employees (SIMPLE). A financial consultant can help you determine what are qualified retirement plans and what kind of tax advantages to they offer that best helps your company.

Just as your business must adapt to uncertain financial times, so must your retirement plans adapt to your changing business and employee needs. To do this, a financial planner can help you with:

  • Fulfilling your fiduciary responsibility to your company adn employees
  • Preparing program guidelines and staying in compliance
  • Keeping investments diversified
  • Manage the level of risk you’re comfortable with
  • Providing participants of up to date documentation on plan benefits and changes
  • Monitoring investments by participants
  • Educating you on what the market is doing an how to take advantage of it.

Financial advisers like Rhonda Porter can help you optimize to your level of risk/security and your business’s unique tax positions for a minimum cost. Once a plan is settled on, these plans are straightforward to setup and easy to maintain.