Here are some of the mental health challenges that high-net-worth individuals may face, how to address stigmas surrounding the issues, and a few practical tips to help you prioritize your mental health while continuing to pursue wealth and success.

Isolation and Loneliness

Wealthy individuals often find themselves isolated due to the challenges of managing significant assets. Common fears of being misunderstood or taken advantage of may further contribute to feelings of loneliness, particularly for those who grew up in lower-income families and then became wealthy.

Perfectionism and High Expectations

Pursuing success may breed perfectionism and high expectations. Constantly striving for excellence may lead to chronic stress, anxiety, and a never-ending quest for validation along the way.

Fear of Failure and Financial Stress

Even when you have financial success, the fear of an economic downturn or other crisis may be a constant source of stress. The pressure to maintain a certain lifestyle may also create a perpetual cycle of anxiety.

Stigma Around Mental Health

It’s common for high-net-worth individuals to hesitate to seek help due to the stigma surrounding having mental health problems. The misconception that money equals happiness may deter people from acknowledging, let alone addressing, their mental health struggles.

Tips to Help You Prioritize Your Mental Health

Here are some tips to up-level how you deal with your mental health.

Break the Silence

Challenge mental health stigmas by openly discussing mental health issues within your social and professional circles. By sharing your experiences, you may also create a supportive environment that encourages others to seek help.

Get Professional Guidance

Just as you consult financial professionals for wealth management and attorneys for legal advice, enlist the help of mental health professionals to navigate any struggles or challenges with your emotional and mental well-being. Therapists and counselors may provide valuable insights and coping strategies you may not be able to discover on your own.

Establish Work-Life Balance

Integrate regular downtime into your schedule to help avoid burnout. Setting aside time for hobbies, family, and self-care may help you maintain a healthier work-life balance and leave work-related stress at work.

Set Realistic Expectations

It’s important to understand that perfection is unattainable. Establishing realistic goals may alleviate the self-imposed pressure that comes from trying to maintain unattainable standards.

Practice Mindfulness and Stress Reduction Techniques

Incorporate mindfulness practices like meditation, yoga, and deep-breathing exercises into your routine to help manage stress and promote mental well-being.

Wealth, success, and mental health are intricately intertwined. This Stress Awareness Month, we want to encourage a more holistic approach to success that encompasses financial prosperity and mental well-being. After all, true wealth isn’t just found in your bank accounts but also in the overall happiness and fulfillment you find in life.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This article was prepared by WriterAccess.

LPL Tracking #540923

The post Wealth, Success, and Mental Health: Finding the Balance Between Wealthy and Healthy appeared first on Tribox Private Wealth.

Seeking the help of a professional to assist in one’s wealth planning leaves more time for them to focus on their primary specialty area, thus driving efficiency in managing results. Often, these individuals are focused on their careers, are business owners, or are high achievers with many goals. Here are ten ways a financial professional can assist high-performing individuals work toward improving their financial health.

1. Planning for goals

A financial professional can develop a customized plan considering income, expenses, financial goals, risk tolerance, and investment strategies. This holistic plan considers all aspects of a high-performing individual’s financial life and aligns them with their goals.

2. Planning for retirement

It’s vital to start planning early to maintain your desired lifestyle while working and after retirement. Financial professionals will work to understand your retirement lifestyle goals and devise a comprehensive plan based on your goals, risk aversion, and timeline.

3. Investment advice based on your situation

Investing can be a complex process. A financial professional can help with investment diversification and recommend suitable investment strategies to help manage financial goals.

4. Tax planning

Efficient tax planning can result in significant financial savings. Financial professionals are equipped to recognize your tax liabilities and objectively propose strategies to mitigate taxes.

5. Risk management and insurance

From health insurance to life and property insurance, financial professionals can help you understand the importance of appropriate insurance coverage. Your assets may avoid early depletion with suitable insurance, making insurance essential to asset preservation.

6. Debt management

Too much debt can hinder financial independence. Financial professionals work with you to determine appropriate strategies for prioritizing and paying off debts, maintaining a healthy credit score, and working toward financial confidence.

7. Estate planning

Comprehensive estate planning ensures efficient wealth transfer to beneficiaries. Financial and legal professionals together will help guide you through complex processes such as drafting a will, setting up trusts, and tax implications based on your situation.

8. Education funding

Whether you’re funding your child’s education or returning to school yourself, a financial professional can guide you on appropriate strategies for paying for education without jeopardizing your financial goals.

9. Emergency funding

Unexpected situations that require immediate financial resources may arise. A financial professional will help develop a strategy for creating an emergency fund and determine the appropriate amount to set aside as you work toward a fully funded emergency fund.

10. Behavioral coaching

Money decisions often involve a lot of emotions; market ups and downs and other significant life events can derail your long-term financial goals. If your emotions dictate your investment decisions, a financial professional can help you manage them to keep you on track toward pursuing your goals.

Remember, financial wellness is not just about acquiring wealth; it’s also about managing and preserving it for the future. High-performing individuals must seek guidance in this endeavor, as managing finances requires the help of a financial professional, time, and continuous effort.

Important Disclosures:

This material was created for educational and informational purposes only and is not intended as tax, legal, insurance or investment advice. If you are seeking advice specific to your needs, such advice services must be obtained on your own separate from this educational material.

 All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.This article was prepared by Fresh Finance.

LPL Tracking # 538128

Sources

https://www.forbes.com/advisor/investing/financial-advisor/what-is-a-financial-advisor/

The post Asking for Help Is a Strength, Not a Weakness. Here Are 10 Ways a Financial Professional Can Assist You appeared first on Tribox Private Wealth.

Earnings get taxed for Social Security up to $168,000 in 2024

If you work for an employer, both you and your employer pay a 7.65% tax for Social Security and Medicare tax up to $168,000 of your earnings. Of the 7.65%, 1.45% goes toward Medicare. Higher earners may be required to pay an additional 0.9%.

If you are self-employed, you pay both the employee and employer amounts, 12.4% Social Security tax, and a 2.9% Medicare tax, amounting to a total of 15.3%. These taxes are also known as the Federal Insurance Contributions Act (FICA).

Determining the context of your retirement for the Internal Revenue Service (IRS)

The Social Security Administration will want to know if you are retiring entirely or if you plan to continue working. If you are of retirement age or older, you can receive your Social Security benefits whether or not you retire from your business. You are allowed to get Social Security retirement or survivor benefits and work at the same. The catch is if you are younger than full retirement, there are income limits, and if you are above them, your benefits may be reduced.

If you are a lower earner

A lower earner may be allowed to continue working and receive their full Social Security benefit and not be subject to a penalty.

Earnings test threshold in the year you reach full retirement age

If you reach normal retirement age in 2024, the annual exempt amount has increased to $59,520 for the months you hit full retirement age, up from $56,520. When you reach retirement age, $1 in benefits gets withheld for every $3 above the limit.

If you reach normal retirement age after 2024, the annual exempt amount is $22,320. In this case, $1 in benefits is withheld for every $2 of earnings in excess of the lower amount.

Beneficiaries could have 85% of their benefit income taxed

Contrary to popular belief, Social Security benefit income may get taxed. If you are an individual tax filer earning between $25,000 and $34,000 or married and filing jointly earning between $32,000 and $44,000, you could be subject to tax up to 50% of your benefits. If you are an individual filer and your income exceeds $34,000 or married with an income in excess of $44,000, you may pay taxes on up to 85% of your benefits.

Groups exempt from paying Social Security and ineligible for benefits:

Generally, most American workers are automatically enrolled to pay into Social Security; therefore, in time, they will be able to receive them. Some groups are exempt from paying Social Security taxes but can’t receive them either. Here are a few groups that meet the eligibility to be exempt:

• Temporary student exemption
• Employees of foreign governments
• Nonresident aliens
• Specified recognized religious groups

Consult a financial professional

Social Security and tax rules change often, and they can be complicated. When applying these rules to your financial situation, your decisions may impact you and your business goals in various ways without even realizing it. Consider consulting a financial professional who can work with you as you strive toward aligning your financial decisions with your strategy and long-term business goals.

Important Disclosures:

Content in this material is for educational and general information only and not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

Sources:

Social Security may affect workers in 2024. 3 rules to keep in mind (cnbc.com)

How Social Security Works for Business Owners – Due

What’s New in 2024 (ssa.gov)

Who Is Exempt From Paying Into Social Security? (investopedia.com)

This article was prepared by LPL Marketing Solutions

LPL Tracking # 541156

The post The Business Owner’s Guide to Social Security: Planning for Your Future appeared first on Tribox Private Wealth.

Equity compensation is a non-cash remuneration through which employees receive a form of ownership interest in the company. This method benefits employees directly as the company’s value increases. For example, startups and growing businesses are often cash-poor and unable to provide high monetary compensation. Equity compensation helps attract top talent, motivate performance, and align employees’ interests with the company’s strategic objectives.

Types of Equity Compensation

1. Stock Options– a contract that grants employees the right (but not the obligation) to purchase company shares at a predetermined price. Two main kinds of stock options exist, with the main difference being in their tax treatment:

• Incentive Stock Options (ISOs)- gives an employee the right to buy shares of company stock at a discounted price with possible tax breaks on the profit.
• Non-Qualified Stock Options (NSOs)- The employee can buy shares at a discounted price and then pay ordinary income tax on the difference between the grant price and the option’s stock price.

2. Restricted Stock Units (RSUs) – a promise from the company to grant shares of stock or the cash equivalent at a future date once specified conditions are met, like a certain period of service or performance goals.

3. Stock Appreciation Rights (SARs) – are rights given to employees to receive the appreciation of company shares. They hold similarities to stock options while excluding employees needing to purchase the shares to realize a gain.

4. Employee Stock Purchase Plans (ESPPs) – permit employees to purchase company shares at a discounted price.

Once a business owner understands equity compensation and its various types, it is crucial to establish a detailed equity compensation plan by working with legal, financial, and tax professionals. Below are some steps to help guide business owners as they consider an equity compensation plan:

Step #1 – Determine the Objective. Clearly define your plan’s goal: attracting and retaining, motivating, or aligning employee expectations with business objectives.

Step #2 – Decide the Type of Equity. From the above-listed options, choose the appropriate type for your company’s goals and the employee’s position. For instance, RSUs might be suitable for higher-level executives, while ESPPs could be suitable for general employees.

Step #3 – Establish the Terms. The term must include defining vesting schedules, setting the exercise price (for options), indicating the event(s) that can lead to the lapse of restrictions, etc.

Step #4- Communicate the Plan. Once finalized, communicate the plan clearly to your employees. It is crucial that they fully comprehend their equity compensation packages, their potential benefits, and associated risks.

Equity compensation can be a suitable strategy for a company to reward, motivate, and retain its employees. These plans can be appropriate to help employees benefit financially from the company’s confidence, and business owners can drive their company’s growth by aligning the interests of the business and its employees.

Drafting an equity compensation plan can be complicated and requires professional advice to execute it. Therefore, business owners must seek advice from legal, financial, and tax professionals or compensation consultants to help ensure the most suitable compensation plan for the business and its employees.

Important Disclosures:

This material was created for educational and informational purposes only and is not intended as tax, legal or investment advice. If you are seeking investment advice specific to your needs, such advice services must be obtained on your own separate from this educational material.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

This article was prepared by Fresh Finance.

LPL Tracking # 476973

The post A Business Owner’s Guide to Equity Compensation appeared first on Tribox Private Wealth.

A CBP – What Is It?

A CBP is a tax-advantaged defined benefit pension plan. Like other pension plans, it encourages long-term savings. However, unlike traditional pension plans, CBPs offer individual accounts for each participant and define an individual’s benefit in terms more characteristic of a defined contribution plan.

In a CBP, the participant’s account balance is credited each year with a “pay credit” – typically a percentage of their salary – and an “interest credit.” The interest credit may be either a fixed or variable rate linked to an index such as the one-year Treasury bill rate. The underlying benefit of the CBP is the guarantee that the investment strategies will earn a specific return, reducing the risk for plan participants.

Why CBPs may be attractive to business owners

CBPs may be particularly attractive to business owners for several reasons. For one, they enable more significant, tax-deductible contributions, facilitating effective tax management strategies for companies. Furthermore, the higher contribution levels typically associated with these plans significantly increase the duration at which retirement savings can accumulate.

As plans are age-weighted, older business owners and high-earning employees close to retirement can benefit significantly. Participants can “super-fund” their retirement savings since these plans allow for larger contributions for older workers, thus enabling them to catch up on contributions if necessary. The catch-up feature of CBPs is conducive to rapidly contributing to a retirement savings plan as the participant works toward an independent retirement.

Advantages of CBPs

There are numerous advantages of CBPs that business owners may find appealing:

Asset preservation

Along with the benefits above, CBPs provide excellent asset preservation. The Employee Retirement Income Security Act of 1974 (ERISA), under which these plans fall, offers protection against creditors. Thus, business owners can more effectively protect their retirement savings assets.

Retaining and attracting top talent

CBPs are attractive to business owners and vital in retaining top employees, such as management and employees critical to the company’s success. CBPs are also an effective recruiting tool to attract top talent to the company.

Dual retirement plan participation

If a business owner participates in another retirement savings plan, such as the company’s 401(k) plan, they are also eligible to participate in the company’s CBP. However, the contribution limit for the CBP is often three to four times higher than that for a 401(k). The contributions are tax-deductible to the company, saving thousands of dollars in annual taxes.

CBPs are easy to understand

CBPs are straightforward when calculating benefits since benefits are stated as a balance rather than calculated based on position in the company, years of service, etc.

Flexibility

Another feature of CBPs is that different participant classes with varying contribution levels can be set up – only some receive the same contribution. For example, the business owner, partners, or senior management may receive differing contributions.

Understanding the costs and risks of CBPs

While the CBP has several benefits, business owners must understand the associated costs and risks of this type of retirement plan. CBPs must be managed by a plan administrator, much like a 401(k), which incurs management and fund costs. However, CBPs also must utilize the services of actuaries, which come at an additional cost. Here are other risks business owners must be aware of before considering a CBP retirement savings plan:

Contributions, regardless of company profitability

When having a CBP, the company must commit to making annual contributions irrespective of their profitability, and there can be potential penalties if the plan is terminated early.

Liable for benefits

The company is also liable for ensuring funds to cover all accrued benefits, meaning that if the investments in the CBP underperform, the company is responsible for covering the shortfall. Companies should diversify their CBP investment portfolios or employ a liability-driven investing strategy to mitigate such risks.

Limitations on contribution limits

Like all retirement savings plans, CBPs also have IRS income limitations. Business owners must know the IRS limits, which may change occasionally. Also, the income of plan participants may change yearly based on factors such as company profitability tied to salary. For this reason, a yearly actuarial calculation determines how much each plan participant will contribute to the CBP.

Because CBPs can be complex, business owners must work with a financial professional who works with business owners, understands CBPs, IRS rules on this type of plan, and the various company retirement savings plans available. Because a business owner’s situation differs from others, they must also rely on tax professionals who understand the business owner’s unique situation.

In conclusion, CBPs are a retirement savings option that may provide substantial tax deductions, allow for rapid savings accumulation, offer asset preservation, and provide higher contributions for older workers. However, understanding the cost and potential risks is fundamental when implementing a CBP retirement savings plan. Therefore, before implementing a CBP retirement savings plan, business owners should consult with financial and tax professionals to understand the benefits and risks of CBPs and how to integrate this unique retirement savings plan into their broader retirement savings strategy.

Sources:

https://www.journalofaccountancy.com/issues/2023/jan/rise-of-the-cash-balance-pension-plan.html

https://www.dol.gov/agencies/ebsa/about-ebsa/our-activities/resource-center/fact-sheets/cash-balance-pension-plans

Important Disclosures

This information was developed as a general guide to educate business owners and/or plan sponsors but is not intended as authoritative guidance or tax or legal advice. Each plan has unique requirements, and you should consult your attorney or tax advisor for guidance on your specific situation.  In no way does advisor assure that, by using the information provided, business owners and/or plan sponsors will be in compliance with ERISA regulations.

This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.

This article was prepared by Fresh Finance.

LPL Tracking #536071

The post Cash Balance Plans: A Unique Retirement Savings Plan for Business Owners appeared first on Tribox Private Wealth.

Case Study: Meet John, the Game-Changer

John, a solo business owner, was contributing the max to his 401k but felt he could do more. That’s when he discovered the power of 409A Deferred Compensation Plans and Defined Benefit Cash Balance Plans. With the right strategy, John is now able to contribute an astonishing $200,000 per year towards his retirement.

Why It’s a Game Changer

Maximize Savings: Go beyond the limits of traditional retirement plans.

Tax Benefits: Utilize favorable tax laws to enhance your savings.

Customized Planning: Tailor a plan that fits your unique business needs.

Did You Know?

The IRS actually encourages this! They recognize the need for substantial retirement savings for entrepreneurs like you. These plans aren’t just for the corporate giants – they’re for go-getters like us who dream big.

Take Control of Your Future

Don’t let traditional limits hold back your retirement dreams. Dive into the world of alternative retirement plans and see your savings skyrocket. Remember, the earlier you start, the more you benefit. Let’s break the barriers together!

Learn More

Interested in exploring how this could work for you? Reach out for a personalized consultation. Together, we’ll chart a course to a secure and prosperous retirement.

Important Disclosures

All investing involves risk including loss of principal. No strategy assures success or protects against loss.

LPL Tracking #531630

The post Unlock Your Retirement Potential: Think Beyond 401k! appeared first on Tribox Private Wealth.

What is corporate cash management?

Cash management is a multifaceted strategy designed to optimize a company’s financial operations and enhance profitability by efficiently managing liquidity and investments. Business owners must manage their capital in such a way that they can work toward their short-term financial obligations, make suitable investment decisions, and maintain a positive cash flow for their company. Here are some areas included within corporate cash management:

Managing cash flow

Cash flow management involves planning and controlling cash receipts and payments to ensure adequate cash is available when required. Better collection policies, efficient inventory management, and prudent purchasing procedures improve cash flow. The ability to manage the cash flow ensures predictability and security in operations, thereby reducing financial uncertainty.

Monitoring cash balances

Business owners must maintain a suitable cash balance and determine the appropriate level of cash required by analyzing their operating and financial cycles. Too much cash on hand may indicate lost investment or expansion opportunities, whereas having insufficient cash can disrupt company operations. Monitoring cash balances aids in maintaining an appropriate cash balance by providing timely and accurate financial forecasting.

Investment opportunities

Business owners can benefit from short-term investment opportunities through corporate cash management. Effective cash management prioritizes liquidity and recognizes the potential for returns from short-term investments. When surplus funds are available, they can be invested in low-risk, short-term investments, providing additional income for the company and thus boosting its overall profitability.

Banking relationships

Corporate cash management also assists in managing banking relationships, which involves effectively communicating with financial institutions to understand their service offerings and negotiating better terms. The interaction with banks and lenders is critical for business owners as it directly influences the cost of financial transactions and the availability of financial services.

Risk management

Moreover, corporate cash management incorporates risk management policies by identifying potential financial risks and creating measures to safeguard the company’s financial health from unforeseen disruptions. These risk management strategies may entail diversification of investments, restricting financial exposures, or purchasing insurance on sensitive company assets.

Professional guidance

Implementing suitable corporate cash management strategies and policies for a company must involve the appropriate people. These include the business owner, management, and specific company departments such as accounting, purchasing, etc.

It’s vital that business owners also include outside professionals, such as financial and tax professionals experienced in corporate cash management and working with business owners. Cross-collaboration with teams central to cash management must be adequate so that the execution of the company’s cash management strategy occurs promptly.

Technology

Corporate cash management may include using sophisticated technology to improve the company’s financial operations’ accuracy, speed, and ease, thus saving human capital hours. These technologies can range from automated payment arrangements to real-time tracking of financial transactions. By leveraging these technologies, business owners can benefit from managed operational costs, improved financial transparency, and enhanced decision-making capabilities. Here are examples of technologies that may enhance a company’s corporate cash management:

• Banking APIs
• Same Day payment technology
• Direct bank (FTP) connections
• ACH, SWIFT connectivity.
• Two-way connectivity between bank and accounting solutions
• Inventory management technology
• Investment portfolio access and monitoring

Measurement and forecasting

When incorporating cash management best practices into a company’s overall growth strategy, appropriate measurement and forecasting must occur. This strategy includes estimating the amount of cash flowing into and out of a company and comparing the estimate to the actual cash flow over a period such as a month or quarter.

Once the measurement has occurred, the appropriate individuals receive the information and the forecasting updates. Measurement and forecasting are ongoing processes that may be affected by geopolitical factors, supply chain issues, economic factors, a skilled and ready workforce, etc., impacting the company’s profitability.

In conclusion, corporate cash management is vital in ensuring a company’s financial effectiveness and sustainability. By appropriately controlling cash flow, maintaining suitable cash balances, taking advantage of short-term investment opportunities, managing banking relationships, incorporating risk management, working with professionals, leveraging technology, and forecasting, the business owner can seek to optimize their financial operations and improve the stability and profitability of their company.

Sources:

https://www.treasurefi.com/blog/integrating-commercial-cash-management-into-your-business-strategy

https://www.investopedia.com/articles/investing/041515/why-cash-management-key-business-success.asp

Important Disclosures

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by Fresh Finance.

LPL Tracking #536271

The post How Corporate Cash Management Helps Business Owners appeared first on Tribox Private Wealth.

The importance of building credit can’t be overstated. Here are a few strategies to consider to help build it:

Register your business

Registering your business establishes it as its own legal entity and provides better access to securing loans from banks and capital, which you can use to build business credit. Along with building a solid business credit score, registering your business also offers legal and tax benefits and helps you mitigate personal liability suits brought against you from any business dealings.

Open a business bank account

A business bank account can help to build a relationship and track record with the bank. This can be beneficial when you apply for a business credit card or a loan. Being an existing customer may help you to build your business credit.

Apply for a business credit card

Having a business credit card helps to establish your business’s credibility. If the payments are made on time, that also helps build your business credit and acquire a higher score. A business credit card also works to improve business cash flow and to obtain higher credit limits over time.

Borrow from lenders that report the payments to the business credit bureaus

Borrowing from lenders that report the payments to the major credit bureaus is beneficial as it helps to raise your business credit score and develops your creditworthiness.

Establish credit with suppliers and vendors

A quick way to build business credit is by applying for net terms with suppliers and vendors. For example, net 30 accounts allow you to buy now and pay later. The accounts extend you 30 days to pay in full after purchasing of a product. This type of practice is known as supplier credit, vendor credit, and trade credit. Suppliers and vendors then, in turn, report the payments made to the three major credit agencies, helping your company build a strong business credit score.

Regularly monitor your business credit report

There are three major credit reporting agencies, each compiling data about businesses, and it is essential to monitor your company’s credit report to ensure the information is accurate. The credit agencies allow you to update general information about your business. Sometimes, incorrect or outdated information makes its way onto your credit file, and you would want to contact the credit agency to dispute the information and request a revision to your report.

Consult a financial professional

Consider consulting a financial professional with experience in building business credit who can teach you strategies to raise your business’s credit score while also providing guidance on creating manageable goals and financial projections based on decisions you make now.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

Sources:

How to Build Business Credit Quickly: 5 Simple Steps | U.S. Small Business Administration (sba.gov)

What Are The Benefits Of A Business Credit Card? – Forbes Advisor

Consumer reporting companies | Consumer Financial Protection Bureau (consumerfinance.gov)

6 Benefits of a Business Bank Account – NerdWallet UK

5 Reasons You NEED to Register Your Business. (linkedin.com)

This article was prepared by LPL Financial

LPL Tracking # 523055

The post The Importance of Business Credit and How to Build It appeared first on Tribox Private Wealth.

1. Modify your business plan

Each day, we wake up, brew our coffee or tea, tap the news app on our smartphone, and watch as the world has inevitably changed again or is undergoing some transformation; generally, it seems these days, technologically. One thing that never changes is how the world is constantly evolving, and if you are a business owner, staying on top of these changes is critical to working to ensure your business plans and strategy remain aligned with your financial and business goals.

It is critical to regularly review your business plan and modify it when necessary. An excellent example of a company that not only evolved with the changing world and market and did so by reinventing themselves is Netflix. Netflix was founded in 1997 as a mail-order subscription DVD company. As technology changed and developed, providing viewers the opportunity to stream movies instead of having to rent one, the industry changed, and Netflix changed with it. They modified their business plan and model, which has proved to work so far.

2. Revise your target operating model (if necessary)

The target operating model encompasses the principles of your business and a comprehensive scope of the business blueprint. It allows business owners to pursue a more strategic approach capable of absorbing changes in technology, customer interest, local demographics, business growth, and product diversity and evolving to supply new demands.

3. Explore potential growth opportunity

With the competition businesses faced, the need to stand out and stay relevant is part of the willingness to seek growth opportunities when they present themselves or create new opportunities. To do this often requires business owners to step outside their comfort zone, adopt new trends that may radically transform the way they do business, and view the changing business landscape as a breeding ground for innovation and new ways to problem solve while staying true to your values and beliefs.

4. Study your target market

What is impacting the market at any given time? Is your business affected? Can you capitalize on it or mitigate unnecessary risk? Businesses can study the market to learn more about customers’ changing needs and preferences. As the business landscape becomes more crowded with new companies planting roots, how can you get a competitive advantage? There are a lot of questions that arise when it comes to studying your target market.

5. Consult your financial professional

The financial decisions you make are critical to the growth and evolution of your business. Taking the initiative to consult a financial professional could help you revise your overall business plan and strategy, mitigate any unexpected risks or obstacles, and help reduce financial stress by being prepared.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by LPL Marketing Solutions

Sources:

Netflix History, Founding & Popular Shows | Study.com

The Importance of Regularly Reviewing and Updating Your Business Plan (linkedin.com)

The Importance Of Embracing Change In Business (forbes.com)

End-of-Year Review Tips for Small Businesses to Finish Strong (yourdigitalresource.com)

KPMG Target Operating Model – KPMG Global\

5 Things To Do After Launching Your Business – Rocket Lawyer

LPL Tracking # 508625

The post You started a business: Now what? appeared first on Tribox Private Wealth.

With some of SECURE Act 2.0’s provisions starting in 2024, business owners must know how it may impact their situation. SECURE Act 2.0 features a host of potential changes for 2024, including adjustments to RMD rules, auto-enrollment retirement plans, changes to catch-up contribution rules, increased annuity options, and other new provisions to help employees pursue financial independence. Here are the details of each provision to remain compliant with the Act.

1. Adjustments to Required Minimum Distributions (RMDs)

The SECURE Act 2.0 would amend the required minimum distributions (RMDs) rules. Under the original SECURE Act, the age at which individuals had to start taking RMDs from their retirement accounts increased from 70 ½ to 72. 

SECURE Act 2.0 further extends this age to 73, beginning in 2024. This amendment impacts retirement plans and obligations concerning employee retirement benefits and the new RMD age.

2. Auto-enrollment in 401(k) plans

Starting in 2024, the SECURE Act 2.0 proposes that employers automatically enroll their employees in their 401(k) plan. While employees can opt out, the objective is to encourage more employees to save for retirement. Additionally, employers must establish efficient systems for automatic enrollment and provide clear information to their employees about this change.

3. Amendments to catch-up contribution rules

The SECURE Act 2.0 also proposes that employees aged 50 and older can make additional catch-up contributions of up to $7500 into their employer-sponsored retirement savings plan. Employers must adjust their retirement plan terms to account for this change and educate their employees about the new rules.

4. Increased annuity options

The SECURE Act 2.0 also includes provisions to increase annuity options within individual retirement accounts (IRAs) and 401(k) plans. This development aims to give retirees an income stream during their retirement years through the annuity option within their retirement account. Business owners must familiarize themselves with new annuity options and potentially roll out new retirement plans or update their plan’s strategies to include additional annuity options in early 2024.

5. New Roth 401(k) RMD rules

Participants in a Roth 401(k) no longer need to take required minimum distributions (RMDs), which conforms to the rule that already applies to Roth IRA account owners.

6. Employee student debt relief

Employers can now offer student debt relief through workplace retirement plans, such as 401(k)s, by matching contributions toward an employee’s student loan repayments. The employee elects the employer to match their loan versus their employer-sponsored retirement savings plan. However, the employee must continue participating in the employer-sponsored retirement plan to receive the employer’s match toward their student debt.

7. Employee emergencies and savings accounts

Emergency funds provision

Starting in 2024, employees can withdraw up to $1,000 penalty-free from IRAs or 401(k)s for emergencies, regardless of whether the person has reached age 59½. 

Emergency savings accounts

Emergency savings accounts within retirement plans can now be offered to employees who contribute (on an after-tax basis) to that account within the retirement savings plan. However, a participant’s emergency savings account balance may only be $2,500 at most.

Domestic violence provision

Employees under age 59 ½ who are experiencing domestic violence can take up to $10,000 from their IRAs or 401(k)s without paying the 10% penalty.

With the SECURE Act 2.0 in view for 2024, business owners must prepare for and implement the above provisions. Business owners must understand the implications of these changes, educate their employees accordingly, and adjust their retirement plan documents to ensure they comply or face penalties at tax time.

8. Roth IRA employer contributions

Traditionally, employer matches are made with pre-tax dollars that go into an employee’s pre-tax account, such as a traditional 401(k). Starting in 2024, employers can make matching contributions into an employee’s Roth 401(k), where the monies will grow tax-free, with tax-free distributions in retirement. This new provision is optional, and employers may still elect to make pre-tax matches.

The proposed SECURE Act 2.0 is still a work in progress and will change in the coming years. Therefore, business owners are encouraged to update their retirement savings plan based on the above provisions for 2024 and work toward more provisions rolling out through 2033. Business owners must work with financial and tax professionals and their retirement plan sponsors to remain informed and prepared for each new year’s SECURE Act 2.0 provision rollout through 2033.

In summary, the SECURE Act 2.0 solidifies the need for business owners to prepare for its implications. By understanding the new adjustments to RMDs, auto-enrollment, amendments to catch-up contributions, and the increase in annuity options, business owners can ensure that they comply and that their employees are suitably prepared for a comprehensive retirement.

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Important Disclosures

Content in this material is for educational and general information only and not intended to provide specific advice or recommendations for any individual.

This information is not intended to be a substitute for individualized legal advice. Please consult your legal advisor regarding your specific situation.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by Fresh Finance.

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