Retirement Plans
Spence Asset Management provides retirement planning with businesses utilizing the following vehicles:
401k
A qualified plan established by employers to which eligible employees may make salary-deferral (salary reduction) contributions on a post- and or pre-tax basis. Employers may make matching or nonelective contributions to the plan on behalf of eligible employees and may also add a profit-sharing feature to the plan. Earning accrue on a tax-deferred basis.
403b
A 403(b) plan, is a retirement plan for certain employees of public schools, employees of certain tax-exempt organizations and certain ministers. Individual accounts in a 403(b) plan can be any of the following types:
- An annuity contract, which is provided through an insurance company,
- A custodial account, which is invested in mutual funds or
- A retirement income account set up for church employees.
Generally, retirement income accounts can invest in either annuities or mutual funds.
IRA
An IRA is a retirement investing tool that can be either an "individual retirement account" or an "individual retirement annuity". There are several types of IRAs: Traditional IRAs, Roth IRAs, SIMPLE IRAs and SEP IRAs.
Traditional and Roth IRAs are established by individual taxpayers, who are allowed to contribute 100% of compensation (self-employment income for sole proprietors and partners) up to a set maximum dollar amount. Contributions to the Traditional IRA may be tax-deductible depending on the taxpayer's income, tax-filing status, and coverage by an employer-sponsored retirement plan. Roth IRA contributions are not tax-deductible.
Roth IRA
An individual retirement plan that bears many similarities to the Traditional IRA. Contributions are never deductible, and qualified distributions are tax-free.
Simple IRA
A retirement plan that may be established by employers, including self-employed individuals. The employer is allowed a tax deduction for contributions made to the SIMPLE. The employer makes either matching or non-elective contributions to each eligible employee’s SIMPLE IRA and employees may make salary deferral contributions.