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401K Plan Information For Employers
Rollover IRA Information For Employees & Retirees


Employees and Retirees considering a rollover IRA for their 401k Plan assets, Please Click Here

Are you an EMPLOYER considering a retirement plan for your employees? Does your retirement plan need review?

You know the importance of long-term retirement planning. Your future, and that of your employees, depends on it. What you may not know is how much your company can benefit from establishing the right retirement plan. Whether you are a small businessman with less than 10 employees, or a larger company with 500 - 1,000 plus employees, you could have the same organizations managing your retirement plan assets that manage money for many Fortune 500 companies, or create your own model that provides you with maximum flexibility in your investment option choices. The companies we recommend may be especially well-suited for your retirement plan because they offer:

If an all-in-one plan is too inflexible and you are, for example, a small business owner or desire to establish a solo 401K plan with access to a full range of investment products including stocks, bonds, limited partnerships and no-load funds, we can also establish an individualized plan to meet your specifications including all plan documents, a third party administrative solution and access to no-load, no 12b1 fee funds and any other kind of regulated security.

With the vast array of options available to employers it is most important to choose the right plan for your company. The right plan can:

  • attract and retain quality employees. As more people worry about saving enough for retirement, company-sponsored retirement plans are becoming an important consideration in their employment decisions.

  • Let the government pay part of your costs. The money you spend to set up the plan and contribute to your employees’ accounts is tax-deductible.

As an employer who is thinking about installing a new 401(k) or defined benefit pension Plan, you may have concerns about meeting your fiduciary obligations under ERISA and IRC 404(c), among other things, particularly since the signing of the Pension Protection Act of 2006 into law. This is where we can assist you in understanding just what exactly your duties and responsibilities are and how full compliance can be achieved.

Our firm will work with your HR dept. (or the owner personally in the case of smaller firms) to take the load and help minimize your liability as the sponsor of, and fiduciary to the plan. After gathering sufficient information, we will develop and present a written proposal showing the benefits of a 401(k) plan for you and your employees, provide all the necessary compliance tools and mechanisms, as well as extensive documentation regarding the investment option choices for your employees. Our desire is to simplify the entire process so that you can run your business, instead of learning ours. The Pension Protection Act of 2006 significantly changed the rules for pensions plans and 401K plans in America and make more urgent demands of the Employer and plan sponsor to meet his fiduciary obligations including; keeping the plan expenses and employee investment expenses low, the investment options diversified and in line with accepted allocation principles and providing an opportunity for employees to be educated in their options while understanding the inherent risks involved in investing in regulated securities.

If you are an employer that has already installed a 401(k) or other retirement plan in the past you may have questions based on recent tax law changes. For example; Does your 401(k) plan struggle to pass its nondiscrimination tests? Are you forced to limit the amount highly paid employees may contribute, or even refund part of their contributions? Now, if you answered yes to either question, you’ll want to learn more about the safe harbor options available to 401(k) plans. Here are a few highlights:

  • Nondiscrimination tests are not required if you make the necessary contribution and provide annual notice.

  • In years when you want to contribute more than required, you can.

  • You have fewer responsibilities than you would have with a regular 401(k).

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You can even add these safe harbor options to your existing 401(k) plan. We would be pleased to describe how these safe harbor options could benefit your existing plan. We will also run a comparison with your existing plan to ascertain whether a change of investment options featuring lower expense ratios and professional portfolio management could benefit you and your employees. There are hundreds of thousands of plans in America and not a small percentage of these plans still utilize "full load" investment options with high annual expense ratios. This drags down performance over time and enriches only the investment companies offering these fully loaded plans. As a fiduciary, the employer has a duty under IRC 404(c) to review these investment options from time to time to ensure that, among other things, the employee’s best interests are being served by a continuation of the plan’s investment options. Lower expense ratios and a strong investment management team with a proven track record may bring significant new benefits to your employees and help you to attract and retain good employees. In conclusion, if your plan does not have a written investment policy statement, or your investment policy statement is more than two years old without review, PLEASE give us a call immediately, we can help you.

If you are interested in having us develop a proposal for your company retirement plan, or, would like a comparison of expenses, fees and other factors that influence the purchase and exchange of a 401(k), money purchase or defined benefit Plan, please contact us today to arrange an appointment

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Employees, are your retiring, retired or looking for flexibility and broader investment options for your 401K Plan Assets?

If you are close to retirement or thinking of changing jobs and you currently have vested funds in a 401K plan, you may be wondering whether it’s a good idea to move your retirement dollars or "roll them over" into an Individual Retirement Account?

A Rollover IRA is an Individual Retirement Account, generally funded with proceeds from your company’s 401K plan and can be a great choice if you are either changing jobs, or retiring. There are no immediate tax consequences to rolling over your assets since your funds remain tax deferred, generally without incurring penalties. (This may not be true if your company has instituted a plan utilizing variable annuity type accounts through an insurance company) Preferably, assets should be transferred directly from your company sponsored plan into a Rollover IRA. This is called a trustee to trustee transfer of assets.

The major benefit of a Rollover IRA using our firm is absolute flexibility in terms of investment options. Companies offering 401K plans to their employees are subject to numerous rules and regulations promulgated by, among other agencies, the Dept of Labor and employers, owners and some executives are considered "fiduciaries" of the plan. They are required, among other things, to keep overall participant costs at reasonable levels and review investment choices and performance on a regular basis. They are also required to provide plan participants with a diversified choice of investment options and to audit and review these choices regularly. This requires so much work that most employers will offer their employees no more than 7 to 12 investment choices and let a large mutual fund company run the whole thing, which relieves them of much of the more difficult duties faced by a plan fiduciary. It would be impossible for them to meet their fiduciary obligations under ERISA if they offered a thousand choices. Of course, even these limited choices are often not the best choices even if they are perfectly appropriate choices for a 401K plan.

Establishing a rollover IRA account through Taylor & Associates, however, provides incredible flexibility and professional management of your assets in a huge and diversified range of investment choices including thousands of no-load (no 12b1 fee) funds, (both foreign and domestic) individual stocks, bonds, limited partnerships, real estate and other investment options. As a registered investment adviser and fiduciary we take our responsibilities seriously, undergo a process to establish your personal tolerance to risk and, after creating a written investment policy, tailor your investments to your specific criteria. Read more about the process we employ when investing for our clients by Clicking Here.

401K plans, rollover and traditional IRA accounts are subject to the annuity rules and you must begin taking "minimum distributions" within 6 months of reaching age 70 1/2 years of age or incur significant penalties for failing to do so. Withdrawals made prior to age 59 1/2, (unless specifically exempted) are subject to an additional 10% excise tax for early withdrawal. Exemptions from this penalty tax include withdrawals made based on a participant’s death or disability, certain qualified medical expenses, purchasers of a first time home for themselves or certain relatives and qualified tuition expenses for higher education. NOTE: You will still have to pay income taxes on 100% of any withdrawal even if you are not assessed a penalty. For specifics on these exemptions please consult a CPA or qualified tax advisor.

Penalty free withdrawals are also possible prior to Age 59 1/2 providing they are substantially equal payments taken out at least annually until age 59 1/2 years or a minimum of five years, whichever is longer.

I’m often asked whether IRA’s are protected from creditors. Assets in "rollover IRA’s should remain separated from any traditional IRA you may have established in prior years and these funds should never be commingled. Generally, rollover IRA funds originating solely from an "ERISA" protected 401K plan will continue to enjoy this protection. However, traditional IRA’s are not as lucky. Recent changes to the law have sheltered a portion of traditional IRA’s (currently 1 million dollars) from creditors but any excess may be made available to settle creditor claims.

Before making a commitment to a rollover IRA with an insurance company (fixed, variable or equity indexed annuity) that could tie up your retirement dollars for many years with substantial penalties for withdrawals, please allow us to evaluate your current investment options and the overall expenses of your plan and compare them with what we have to offer. For additional information or a second opinion with regard to your retirement plan assets, please call 310. 260. 1126 or E-Mail us today!

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Disclosures: Taylor & Associates (TA) is a CA Registered Investment Adviser regulated by the California Dept. of Financial Protection and Innovation. Insurance Planning Services offered separately and distinctly by Nigel B Taylor under individual CA insurance license number 0716446.

The information herein is provided solely for informational purposes, and should not be construed or interpreted as an offer to buy or sell, or a solicitation of an offer to buy or sell any security or to participate in any particular trading strategy. You should not rely on any information herein to plan or implement any investment, estate or other financial strategy. At certain places on this web site, live links to other Internet addresses may be accessed. Such external Internet addresses contain information created, published, maintained, or otherwise posted by institutions, organizations or individuals totally independent of Taylor & Associates. We do not endorse, approve, certify, or control these external Internet addresses and do not guarantee or assume responsibility for the accuracy, completeness, efficacy, timeliness or correct sequencing of information contained at such addresses. Use of any information obtained from such addresses is voluntary, and reliance on it should only be undertaken after an independent review of its accuracy, completeness, efficacy and timeliness. Access to all Pages and hyperlinked pages of this site are subject to the terms and conditions contained in this disclosure. By accessing any page on this site, you expressly agree to be bound by this written policy. When you leave the web site of Taylor & Associates, you assume total responsibility and risk for your use of any site you are linking to