More to retiring than 401(k)

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At some point in our careers we have said to ourselves, "I need to start contributing to my 401(k)." With any luck, we recognized this need early, rather than late.

But if we were asked, "What additional financial strategies have you implemented for retirement, as well as the livelihood of your beneficiaries?" many of us wouldn't have a definite answer.

Contributing to an employer-sponsored plan, such as a 401(k), and working our way up the corporate ladder isn't the only solution to a comfortable retirement, but part of an overall strategy that develops as we go through life.

Though each of us have different financial goals and ideas of what would be a comfortable retirement, when it's all said and done, the basic concepts are the same when planning a well-devised strategy: wealth management.

For those of us who work in the corporate world, a 401(k) is something we're familiar with four times a year when we receive our quarterly statements in the mail.

And if you're like most Americans over the past three years, you've been watching your balances decline.With most employersponsored plans, your employer will match your pre-tax contribution dollarfor- dollar up to a specified percentage of income, virtually providing you with an immediate return on your contribution.

This should be the primary step in your wealth management strategy.

It is also important to know that with most 401(k) plans, a financial advisor isn't readily available to help guide us through our investment choices, which leaves us out in the cold to fend for ourselves.

The exception to this is the firm that manages most of the investment choices available within your 401(k).

These representatives can be a wealth of knowledge, helping you to decipher through your mutual fund choices and balance your portfolio, but they are also limited to the investment choices available within your 401(k).

In addition, these representatives tend to be someone you've never seen or met, and are not aware of any significant changes in your life or financial goals (i.e.

marriage, children, or early retirement).

Having an IRA or brokerage account with a personal financial advisor, in addition to your 401(k), will provide much greater value to your wealth management strategy.

He or she will also be able to help you review your quarterly 401(k) statements.Whether his or her title is licensed representative or wealth management advisor at a local bank or brokerage firm, a personal financial advisor can provide you with just that personal financial advice based on your goals, objectives, and significant life changes.

Your personal financial advisor will help you look at all of your assets (securities, mutual funds, real estate and insurance) on a consolidated basis annually to determine whether you have enough saved for a comfortable retirement, and provide guidance to correct deficiencies, if any.

Business owners have several choices when it comes to retirement planning.

The plans that come to most of our minds for business owners are Self- Employed Pension Plans (SEP) and Keoghs.

Both of these plans are taxdeferred retirement savings plans, much like an IRA.

The main difference between these plans and an IRA is the contribution limit.

Other choices include a Savings Incentive Match Plan for Employees (SIMPLE IRA) and a Single Participant 401(k).

Both of these plans are similar to a traditional 401(k) plan, but are designed respectively for small businesses with less than 100 employees, and businesses with no employees other than a spouse.

Establishing a qualified retirement plan will not only provide tax deferral benefits for employee contributions, but also may provide tax benefits to the business.

A personal financial advisor will help business owners establish a suitable plan and provide guidance with investment choices.

Having life insurance coverage isn't a strategy that most of us consider until later in our lives as we approach retirement.

It's an important part of a welldevised plan that shouldn't be considered only in our later years, but should be given serious consideration earlier in our lives in the event of an early death.

The purpose of having such coverage is always the same to ensure our surviving family members maintain their livelihoods.

In many cases, the life insurance coverage we possess isn't adequate to cover a majority of the debts we leave behind along with a little nest egg for our beneficiaries.

In addition, the longer we wait to obtain coverage, the harder it becomes to afford a policy that is adequate.

An insurance policy, such as term life insurance, that may cover an individual up to age 70, can have significantly higher premiums for a 50 year old than it would if the policy was acquired at age 40 for the same benefit amount.

As part of a wealth management strategy, many personal financial advisors will review your policy for adequate coverage and reasonable costs, and provide guidance to correct any deficiencies.

Businesses have a similar situation to consider when it comes to insurance.

In these situations it's the business and the surviving owners, rather than family members, that the insurance policy protects.

A buy-sell agreement is an important piece of any business entity.

As your business grows, having proper insurance coverage to transact the buysell agreement and ensure the continuation of the business is equally important.

It provides a means of disallowing the deceased owner's interest in the company from falling into the hands of a person who may not be qualified to run the business, or may be incompatible with the surviving owners.

Another type of insurance policy available to businesses is key-man life insurance.

It is a policy held by the business on the life an employee whose services have played a vital role in the success and continued profitability of the company.

It protects your business from adverse financial effects in the employee's absence, and may be suitable for more than one employee (i.e.

department manager, executive, engineer, or member of the sales staff ).

Many personal financial advisors are also licensed to provide guidance in selecting a suitable policy for your business.

The concept behind wealth management is to encompass financial strategies during life and after death.

It is not limited to just retirement planning and life insurance, but may also include trust services, private banking, college education, real estate, and financing.

A personal financial advisor will help you or your business devise a strategy for all of your significant life changes, and lead you through them to reach your financial goals.

Roland Watkins is a registered representative,Wealth Management Group/Retirement Services at Colonial Bank of Nevada.