Syndicated Financial Columnist, Host of the weekly talk show Steve Savant's Money, the Name of the Game, Scottsdale Arizona
Video Transcript: Hello everyone, I'm Steve Savant, syndicated financial columnist and host of the weekly online talk show Steve Savant's Money: The Name of The Game. I'm answering questions from insurancelibrary.com and today's question is: is a non qualified plan better than a qualified plan?
Well, there's two issues why you should be using a qualified plan, like an example, 401K. You're in a high tax bracket or your employer actually is matching your contribution in some way which I think is a great way to go. If I have a high tax bracket and my employer is doing a match and I have both of those, I think that's a really good play. Qualified plans are the way to go. I get the deduction and my employer is actually contributing. But if I don't have either one of those two, then really the deduction does me no good. I like the life insurance idea because I don't have the same ERISA issues like 59 and a half and I have penalty if I took out my money. So I like the life insurance side of that issue from a non qualified point of view because it accumulates tax deferred and if it's set up correctly, it could come out tax free.
Well, that's our consumer question for today. If you have any question, just submit them to www.insurancelibrary.com.
.JPG){kind=avatar}
Video Transcript: Hello everyone, I'm Steve Savant, syndicated financial columnist and host of the weekly online talk show Steve Savant's Money: The Name of The Game. I'm answering questions from insurancelibrary.com and today's question is: is a non qualified plan better than a qualified plan?
Well, there's two issues why you should be using a qualified plan, like an example, 401K. You're in a high tax bracket or your employer actually is matching your contribution in some way which I think is a great way to go. If I have a high tax bracket and my employer is doing a match and I have both of those, I think that's a really good play. Qualified plans are the way to go. I get the deduction and my employer is actually contributing. But if I don't have either one of those two, then really the deduction does me no good. I like the life insurance idea because I don't have the same ERISA issues like 59 and a half and I have penalty if I took out my money. So I like the life insurance side of that issue from a non qualified point of view because it accumulates tax deferred and if it's set up correctly, it could come out tax free.
Well, that's our consumer question for today. If you have any question, just submit them to www.insurancelibrary.com.