It can be overwhelming researching and choosing the right retirement plan. This may be especially true if you are an employer wanting to offer the best options to set your valuable employees up for a smooth retirement as well. Many questions can arise, such as:

• What is the difference between a 401(k) and 403(b) plan?
• What are the different types of IRAs?
• Where do I begin planning ownership transfer when I decide to retire?

Benefit and Financial wants to shed some light on the options available out there for both employers and employees. 

No matter where you are in your retirement planning process, our team is ready to answer your questions and find the best resources for you and your employees. We have been helping Flagstaff residents reach their goals for decades, so you can rest assured you're in good hands. Give us a call today to get started!

Buy/sell agreements can be made to prevent management and voting breaks in the event that a key employee dies, goes on disability, or leaves a company. That said, they are a smart way to protect businesses from suffering losses when a key member has moved on. There are two types of buy/sell agreements.

Cross-Purchase Agreement-Remaining owners are allowed to purchase the interests of the lost member.

Redemption Agreement-Business entities are required to buy the interests of the deceased owner.

Cash balance plans are a type of defined benefit plan. Employers credit a percentage of the employee's annual compensation to an account designated for retirement. One of the main appeals of these plans is that they are relatively safe, carrying fewer risks than many other retirement plan options. Other perks include:

• Annual interest credit
• Tax-deductible contributions for employers
• Deferred taxes
• Lump sums or monthly annuities are available.
• Benefits are protected in most plans by the Pension Benefit Guaranty Corporation.
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Let's start with the most well-known ways to save for retirement. While they are similar, they each have unique differences.

Pensions-Like 401(k) plans, most pension plans require employers to also contribute to these accounts. The key appeal of these is that the amount accrued in them over the years can be paid in one large, lump sum when an individual retires.

Profit Sharing-Just like it sounds, a portion of a company's profits can be shared with eligible employees. These amounts are based on quarterly and annual earnings. How much profit is shared is ultimately decided on by the business.

401(k) Plans-Employers must match the amount of contributions made to these accounts by the employee. Another appealing aspect is that these contributions are not taxed until later.

403(b) Plans-These plans are similar to 401(k) plans. The main difference is that 403(b) plans are available only to employees of non-profit organizations, such as schools, libraries, and other government agencies.

Simple and SEP IRAs are similar to 401(k) plans, but much easier to set up and use. Simple IRAs also require employers to match an employees' contributions and taxes are deferred until the money is withdrawn.

SEP IRAs are set up by employers and all contributions are made on their behalf. (Employers must still match employees' contributions.) They are less expensive and less complicated to set up than 401(k)s. One of the main perks is that they offer flexible annual contributions, which is great for those who may be going through financial difficulties.

Defined benefit plans are synonymous with pensions. Again, this is an agreement that an employee will receive a predetermined amount of money or benefit on a set date. These accounts are funded and managed by the employer.

Deferred Compensation plans come with risks. While a defined benefit plan is a formal arrangement, deferred compensation is an informal agreement between employer and employee. Essentially, it's a “gentleman's agreement” that the employee will receive deferred funds and investment earnings at a specified time. These are generally only made with high-earning, key employees as a means to retain them.

Defined benefit plans are synonymous with pensions. Again, this is an agreement that an employee will receive a predetermined amount of money or benefit on a set date. These accounts are funded and managed by the employer.

Deferred Compensation plans come with risks. While a defined benefit plan is a formal arrangement, deferred compensation is an informal agreement between employer and employee. Essentially, it's a “gentleman's agreement” that the employee will receive deferred funds and investment earnings at a specified time. These are generally only made with high-earning, key employees as a means to retain them.

In an effort to retain key members of their company and keep them focused on success, business owners can offer executive benefits packages to qualifying employees. These can include salary, perquisites, a severance package, short and long-term incentives, and split-dollar insurance, to name a few. Executive benefits packages are regulated by the U.S. Department of Labor, so it's important to understand eligibility criteria and whether to choose a qualified or non-qualified plan to suit your needs.