Retirement Plan Account Types

Written by Jacey Harmon
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Retirement plan account types are available in several different options. There are types of retirement accounts for individuals and businesses. The type and size of a business will determine which type of retirement plan to utilize. Your businesses classification, such as sole proprietorship or Subchapter S Corporation, will determine which of the retirement plan account types are available to use.

Retirement Plan Account Types for Businesses and Individuals

A traditional 401K is available for use by any for-profit company that can afford to utilize this plan. A Solo 401K can be utilized by any sole proprietorship, partnership or corporation that is owner operated. Keogh plans are intended for unincorporated businesses or self employed professionals. SEP plans can be utilized by any type of business.

The 403b plan is one of the retirement plan account types that are available to not for profit businesses and organizations. Teachers are the most common users of this plan. 403b plans are also available for use by hospitals, museums and other not for profit organizations. They operate similarly to 401K plans.

IRA accounts are the retirement plans available for individuals. IRA stands for Individual Retirement Account and there are two types of these plans available. A traditional IRA is a plan that allows for tax deductible contributions that grow tax deferred until withdrawn at retirement age. Roth IRA contributions are not tax deductible but earnings and dividends are never taxed if withdrawn from the account after age 59½. A financial consultant experienced with these retirement plan account types will be able to help you determine which plan is right for you

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