A properly structured retirement plan is one of the most effective tools for accumulating wealth. For business owners, it serves a dual purpose: significantly reducing your current taxable income while growing your savings in a tax-advantaged environment.

While the "right" plan depends on your business structure and cash flow, the most common options we implement for our clients include:

• Solo 401(k): Ideal for business owners with no employees (other than a spouse). It allows for the highest possible contribution limits by combining "employee" deferrals with "employer" profit-sharing contributions, all with minimal administrative costs.

• SEP IRA: A flexible, easy-to-manage option for businesses with few or no employees. It is funded entirely by employer contributions (up to 25% of compensation), allowing you to vary contribution amounts year-to-year based on profitability.

• SIMPLE IRA: Best suited for small businesses (typically under 100 employees) that want to offer a retirement benefit with low administrative overhead. It requires mandatory employer matching but is simpler to run than a full 401(k).

• Defined Benefit / Cash Balance Plans: The "heavy hitter" for high-income business owners. Unlike the plans above, these allow for substantially larger annual contributions (often exceeding $100k-$200k) to "catch up" on retirement savings, offering massive upfront tax deductions.

As your wealth grows, these assets become a critical component of your broader financial picture. You may have related estate planning and trust questions as well, which we can address in tandem with your tax strategy.