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INVESTMENTS


When you think of investments, you shouldn't only think of a Wall Street banker in a $1000 pinstripe suit. If you have a workplace pension or workplace benefits, then you are an investor as well.

How does an investment relate to workplace benefits?

There are many ways in which your workplace benefits may be tied to securities or bonds. If your benefits are accumulating cash value, you are actually earning a positive net worth as you build it. You are also losing potential securities if you ever have a need to use your workplace benefits.

Who are workplace benefits for?

Although benefits with an investment are becoming more rare, most large corporations still offer them as an incentive to attract top talent. These benefits may include healthcare, company cars, sick leave and budgets for projects.

How do workplace benefits work?

Some of the most progressive workplaces allow you to choose your own investment opportunities in order to increase your workplace benefits. The better decisions you make, the more benefits you have.

What kind of coverages do workplace benefits provide?

Workplace benefits can include protection against accidents on the job, coverage for any sick days that you might take, health insurance for you and your family and other benefits such as prenatal care.

In special workplace benefit packages, you may even receive money to continue an education or to provide some other service to the company with a budget from the company.

What are the major benefits of workplace benefits with an investment component?

The investment component in workplace benefits allows for the expansion of benefits without causing major overhead for the company. Although there is a risk involved in this type of workplace benefit, for the most part, if the investments are correctly balanced, everyone comes out ahead with more benefits all around.


401(k) ROLLOVER

401K rollover is the process of transferring money from a retirement plan into an IRA, or individual retirement account. Usually people do this when they are going from one job to another and want to keep the money they've accumulated in retirement savings from their previous employer. When you roll over your 401K, you'll be able to tax-defer your retirement savings, which gives you a number of options when it comes to investments. 401K rollovers are just one choice for a retirement plan. Each option has its pros and cons.

When you roll your assets to an IRA, you can leave your assets in your last employer's retirement plan if this is permitted. If your new employer allows you to move your assets to a new retirement plan, this is a viable option as well. Or, you can request the cash in your retirement account in a lump sum or installments.

If you're considering rolling over your 401K into an IRA, a number of factors should be considered. For instance, it's best to compare the features of your current 401K and the IRA, such as the services offered for each account and your investment options. You should also take the fees for transferring your money into account, and you'll need to know if there is a penalty for withdrawing your money early. If you maintain assets or investments in your IRA, the cost of this is generally higher than if you performed the same financial actions in a 401K. Once you transfer your retirement funds into a savings account, meeting with a bank professional to determine the best ways to manage your money over the years can help to further secure your retirement funds. Be sure to talk to your tax advisor and/or retirement plan administrator before you make any adjustments to your retirement assets.

IRAs

With all the worry about retirement and Social Security, many are looking for alternative ways to prepare for those infamous “Golden Years”. Many people are finding that an IRA may be an ideal choice to help give them a little
extra cash.

What is an IRA and How Does it Relate to Employee Benefits?

An IRA is an individual retirement account that allows you to have some money for retirement by depositing money into it every year. Unlike 401K plans, which are purchased by employers, IRAs are typically bought by individuals. However, the SEP IRA and the SIMPLE IRA are two retirement accounts that are employer-established. An individual IRA may be purchased from a mutual fund company, bank, financial planner or insurance company.

Who is an IRA For?

Although IRAs are for anyone who is interested in building up a retirement account, they’re most commonly used by individuals who do not have a retirement fund through their employer.

How Does an IRA work?

The IRA is a way to develop a nest egg for retirement. You’re allowed to deposit up to $5,000 per year into an IRA. If your employer doesn’t offer a separate retirement plan, like a 401K, you’ll be able to deduct the entire $5,000 on your income tax. However, if your employer doesn’t offer a retirement plan or they do and you still have an IRA, there are limits to what you may or may not be able to deduct. In an employer-based IRA, the employee and employer
both make contributions.

Different Types of IRA Coverage in Existence

The two major types of individual retirement accounts are traditional and Roth IRA. The main difference between these two is that you cannot deduct the contributions you make to a Roth. Another difference is that you can withdraw money from a Roth when you’re 59 and not have to pay taxes. You also can withdraw early from a Roth without paying a penalty. The other two types are the SEP and SIMPLE.

Major Benefits of an IRA

The main benefit of an IRA is that it gives us the opportunity to save for retirement. However, an even greater benefit of an IRA is that you can deduct your contributions from your income tax, which will decrease your tax liability while you’re still building a savings account.



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