Understanding Your 401(k)

 

Founded in 1995 by Nicholas Giacoumakis, New England Investment and Retirement Group, Inc. (NEINV) assists a diverse array of individuals and businesses with their investment planning and wealth management. As the president of NEINV, Nicholas Giacoumakis provides financial advice to clients, including helping employers manage 401(k) plans for their businesses. NEINV begins by analyzing a business’ current plan, then proposes and implements changes and continues to monitor the plan throughout the year.

The 401(k) is one of the most popular retirement plans, yet many employees are uncertain of what it is or how it works. The employer-sponsored retirement program essentially allows employees to choose between receiving compensation in cash and setting aside a portion into a retirement account that is not accessible for a set period of time. When it is available for withdrawal, however, the money is tax free. Unlike a pension, employers are not required to make contributions to the plan. Nonetheless, many employers will match employee contributions. The 401(k) is what is known as a defined-contribution plan, which means that an individual’s balance is determined by what they pay into the plan, as well as the plan’s performance.

The “Three-Legged Stool” of Retirement Planning

Based in North Andover, MA, New England Investment and Retirement Group, Inc., was founded by Nicholas Giacoumakis, who serves as its president. Veteran financial adviser Nicholas Giacoumakis is dedicated to ensuring that the group’s clients receive first-rate retirement planning assistance.

In the past, retirement planners used the term “three-legged stool” to refer to the three common sources of retirement income: social security, pensions, and personal savings. Now, however, economic changes have altered the formula, and people planning for retirement often need assistance understanding what the new “legs” are and how they can best prepare themselves. Pensions, for instance, are much less common today, having been all but replaced by 401(k) plans, in which employee contributions may or may not be matched by employers. Social security’s future is less certain than it once was, making personal savings increasingly important. However, savings rates in the U.S. have been low over the past decade. Financial advisers can provide help understanding IRAs and other retirement-based savings tools.

Basic Asset Protection Strategies

 


The president and founder of Massachusetts-based New England Investment and Retirement Group, Inc., Nicholas Giacoumakis is a nationally recognized investment advisor with more than two decades of experience. One of Barron’s Top 25 Advisors in Massachusetts, Nicolas Giacoumakis focuses on such areas as insurance planning and asset protection strategies.

For individuals and businesses with assets to provide asset protection strategies, with a number of assets, it is important that they insure them properly. The following are a few of several strategies for doing so:

- Increase liability insurance: Personal liability insurance is one of the best ways to protect one’s assets because it offers inexpensive protection in the case of litigation, for example. Ideally, liability insurance coverage should equal an individual’s net worth.

- Create business entities: Running a sole proprietorship allows individuals to function without a partner, but it puts their personal assets at risk if they are sued. Formal business entities, on the other hand, safeguard personal assets from confiscation in the event of an unfavorable result in a lawsuit, for example.

- Start a retirement plan: Many retirement plans, particularly employer-sponsored plans, offer security above and beyond that represented by personal savings accounts. Although an individual can build security by adding discretionary funds to a retirement plan, it should be noted that those funds are also generally more difficult to access.

- Life insurance for estate planning as well as succession planning purposes. This coverage will provide immediate funding to a business or individuals heirs in the event there is an untimely death of a key executive or family provider.

The Importance of Wealth Management

Nationally recognized investment advisor Nicholas Giacoumakis has been leading New England Investment and Retirement Group, Inc., a 14-member firm in Massachusetts, for over two decades. Together with his team, Nicholas Giacoumakis provides high-quality investment advisory and wealth management services to individuals and groups.

Although many people know about wealth management, roughly six out of 10 people still do not set up a will prior to their passing and even fewer fully create a wealth management plan. An important aspect of life, wealth management helps individuals not only maintain their lifestyles after retirement, but also transfer their wealth to loved ones and others. Retirement is the biggest reason for wealth management’s importance; failing to gauge accurately how much money they will need to survive during retirement, people may lose their houses and/or have to reenter the workforce. Effective wealth management plans can help protect against such eventualities.

In terms of transferring wealth, good wealth management ensures there is enough wealth left to provide some support to one’s heirs. When individuals retire, poor wealth management can lead to them using all of their accrued finances to fund their own survival, leaving no money for heirs or to cover unexpected medical or funeral costs, which can be a huge burden on surviving family members, possibly even putting their own finances at risk. Wealth management can prevent this and may even allow for some extra funds that heirs can put into their savings.