Retirement Planning 2010: Getting a Head Start in the New Year

Timing is very important with investing and the same can be said for setting up your firm’s 401(k) plan.  However, it is often the rare firm manager who recognizes that the groundwork for adopting the plan is best done early in the year.

Considering a 401(k) plan involves eligible employees electing to defer salary, the more payroll periods there are available, the less noticeable the impact is on take-home pay. Contributions must be sent to the retirement plan to be invested, so coordination with your payroll will be necessary and eligible employees will need to decide how to invest.

Making such long-term decisions may be difficult under the pressure of the looming deadlines to set up a 401(k) plan for 2010.  Hence, the earlier in the year you can get this all squared away, the easier you make it for eligible employees and yourself.

So, when is the best time to consider setting up your firm’s new 401(k) plan for 2010?  Quite simply the answer is now.

There is also good news for anybody looking to maximize his/her retirement plan contribution this year. The 2010 benefit and contribution limits will remain unchanged from 2009, which should give you more of a reason to start contributing sooner rather than later.

Following are just some of the 2010 Plan Year limits (for a full listing, visit www.axa-equitable.com/mrp):

Annual Compensation Limit                    $245,000

Annual Contribution Limit*                    $  49,000

401(k) Elective Deferrals**                    $  16,500

SIMPLE 401(k) Deferrals                       $  11,500

SIMPLE IRA Deferrals                            $  11,500

Highly Compensated Employee              $110,000

Taxable Wage Base                                   $106,800

* 100% of compensation if less than dollar limit.

** Always on a calendar-year basis, not a plan year basis. Salary deferral limit includes both pre-tax salary deferrals and after-tax Roth salary deferrals.

The Members Retirement Program, an exclusive member benefit available through the AIA Trust, offers a variety of plan choices to those members just getting started or those who want to maximize their retirement plan contributions. The plan flexibility and services provided by the Program are designed to reduce the hassle and anxiety associated with retirement planning. From set-up through administration, you have access to dedicated professionals experienced in retirement planning. Contact a Members Retirement Program Specialist today at 800-523-1125 ext. 5985 or visit us at www.axa-equitable.com/mrp.

The Members Retirement Program (contract form #6059) is funded by a group variable annuity contract issued and distributed by AXA Equitable Life Insurance Company (NY, NY). AXA Equitable Life Insurance Company does not provide legal or tax advice.

Please be advised that this document is not intended as legal or tax advice. Accordingly, any tax information provided in this document is not intended or written to be used, and cannot be used, by an taxpayer for the purpose of avoiding penalties that may be imposed on the taxpayer. The information was written to support the promotion or marketing of the transaction(s) or matter(s) addressed and you should seek advice based on your particular circumstances.

GE-53031 (12/09)