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.