Entrepreneurship has long been lauded as the American dream in action, especially in Florida. Many of the giants of today’s economy began as small entrepreneurs who ended up building the mega-businesses that dominate our nation.
Jeff Bezos, Bill Gates, Steve Jobs, and Walt Disney all had one thing in common: they became entrepreneurs to achieve their dreams. They took risks, they saw something in the market that no one else did, they bet all they had, and they made their dreams a reality. Today, the stories of these visionary business leaders are part of our common lore.
However, for many entrepreneurs hoping to learn from the greats, the day-to-day reality of business growth and planning for retirement usually doesn’t make it into the business textbooks.
You Will Retire One Day
If you’re running a business any time from your twenties to early fifties, the prospect of retirement seems to be far away. You may even have a “no retirement” attitude.
While that belief shows great energy and ambition, it may be unrealistic. Many people, founders and entrepreneurs included, find themselves slowing down in their late fifties, sixties, and beyond.
You cannot assume that your personal health, family situation, the economy, or your interest in your business will be the same decades from now. Many who believed that the world would stay at a status quo are no longer in business.
Accordingly, you should create a retirement plan today with the help of an attorney who is experienced in tax planning, in case you change your mind about retirement tomorrow. Indeed, as any entrepreneur will tell you, being flexible with your future plans just makes good business sense.
So, what types of retirement strategies can you employ as an entrepreneur? This article will address that issue. By considering the strategies below, you will be well on your way to having the right mindset for retirement and tax planning in Florida and elsewhere.
1. Take Money Out of Your Paycheck Now
Many entrepreneurs are so focused on re-investing in their business that they defer costs until that undefined time period that we call “later.” However, later never comes, or it comes too late for many. By the time you’re thinking about retirement as a real part of your life, you have probably lost out on tens if not hundreds of thousands of dollars in potential earnings toward retirement.
You should, at the very least, consider enrolling in an IRA or other retirement plan that helps you save for your golden years. If you are over 55, then you can contribute more money than the otherwise legally allowable maximum with “catch-up” contributions. That will help keep your retirement well funded for the future.
2. Consider Roth IRAs for Emergencies
Unlike a traditional retirement plan, money contributed to a Roth IRA is taxed when you deposit it. That means that any withdrawal will be tax-free.
That is actually convenient tax planning if you expect to be in a higher tax bracket later on in life and believe it will be helpful to pay taxes now to save money later.
In some cases, you can also use a Roth IRA as a type of savings account if you fund it for five years or more. In that case, you can use the funds in the Roth IRA account for a down payment for your home, college tuition, or emergencies. This can help create a financial cushion in case of a cash crunch for your family or business.
3. Use a Health Savings Account
One of the main challenges for entrepreneurs, especially in the first stages of growth and tax planning for their business, is how to pay for health insurance premiums. While there are some ways to make health insurance more affordable, one of the most effective ways to do so is through a Health Savings Account (HSA).
Using a low-cost insurance plan, an HSA can help ensure that the tax-deductible contributions you make will benefit your health care needs. Year over year, contributions can help create a health care piggybank for you while not compromising on your overall wellness.
In sum, every entrepreneur’s financial situation and journey will be different. From “mom and pop” businesses to smaller shops that end up scaling up to corporations, there is a plan for every business person.
The only plan that will not work is no plan at all. That is why you should work with an attorney experienced in tax planning in Florida so that your retirement plan allows you to enjoy the fruits of your labor long after you need to continue working.
Florida Tax Lawyers Can Help You with Your Tax Planning
There are many options with regard to tax planning, and the choice of the best option depends a great deal on your current business situation. In that regard, you would be wise to enlist the help of a seasoned tax planning attorney in your area.
Indeed, handling any tax problem on your own is generally not a good idea. You should see the big picture in connection with your business and talk to a tax attorney who can help. Mary E. King has spent her career concentrating in tax law and can help you with any of retirement plans and more. Attorney King has a wealth of information about what types of retirement options would make the most sense for you and your business.
That helps explain why she’s received an A+ rating from the Florida Better Business Bureau. If you have a tax related issue – no matter how small or how large – setting up an initial consultation with Tax Attorney Mary E. King is the first step you should take towards relief.
The Law Office of Mary King P.L. offers complete IRS problem solving services including all areas from tax debt settlement to planning the most efficient tax strategy for individuals and businesses. Call us today to schedule an initial consultation. With years of experience handling IRS matters for many clients, Attorney Mary E. King can make sure that your tax issues are resolved efficiently and at the lowest cost to you. Fill out our online contact form, or call us at 941-906-7585.