Retirement Plans

FW Serra has partnered with FNL to provide top quality investment products and services for individuals and businesses.

Financial Network Limited (FNL) is a financial services firm providing comprehensive client services in the areas of Employee Benefits, Investments, Retirement Planning, Insurance and Human Resource Services. Founded in 1984, we continue to be a family owned and operated independent firm servicing clients throughout Connecticut. As one of the founding members of Integrated Benefits, LLC, FNL is part of an organization which provides employee benefit services to over 700 organizations, including two municipalities, throughout Connecticut.

At Financial Network Limited, we will help you to achieve your business and personal goals through products and services along with the highest degree of personal integrity and professionalism. Solid, stable and committed to our clients, Financial Network Limited has proven that quality and service, along with commitment to excellence are the standards of our business practice. Our mission is to be the provider of choice for Employee Benefits, and Investments, and Insurance.

 

Michael J. Delre IIIMichael J. Delre III, Executive VP, Financial Network Limited

As Executive Vice President of Financial Network Limited, Mike works with a diverse clientele of both corporations and individuals seeking his experience and knowledge. His primary focus continues to be the management of the firm's corporate clientele's retirement and employee benefit programs.

As a graduate of Bentley College with a degree in Finance, Mike worked for an insurer as well as a large employee benefits consulting firm in the greater Boston area before joining Financial Network Limited in 1994. In addition to his Finance Degree, Mike also earned the designation of Chartered Financial Consultant (ChFC) from the American College and is actively pursuing the Registered Employee Benefits Consultant (REBC) designation. He is also a Past President of the Connecticut Benefits Brokers Association and a member of several insurer's Broker Advisory Committees. In 2004, Mike was invited to be a Panelist regarding Employer Sponsored Retirement Plans at ING's National Conference in Dallas, TX.

He is a Registered Representative offering securities through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA, SIPC.  Mike is also a Investment Advisor Representative of Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor.  Cambridge and FNL are not affiliated.

 

SPECS ON RETIREMENT PLANS:

What is a 401(k) plan? A 401(k) plan is a type of employer sponsored retirement savings program that allows employees to make pre-tax contributions their account. In addition, several types of employer contributions (such as Safe Harbor, profit sharing and/or matching contributions) are associated with these plans. From the employee's perspective, since the plan is funded with pre-tax dollars that compound tax-deferred, a significant tax advantage can be realized and a substantial retirement account can be built. In calendar year 2006, employees under age 50 can defer $15,000 and those employees age 50 and over can defer an additional $5,000.

In addition to offering employees the chance to save their own money, some corporations will also choose to make contributions on behalf of their employees in the form of "a safeharbor plan", "company matching contributions" and/or "discretionary profit sharing contributions". Like salary deferral contributions, these monies grow tax deferred in each participant's (self-directed) account.

Advantages:

  • The chance to lower your current income taxes, because you are deferring a portion of your taxable income, your base pay is lower - and that means you may be taxed at a lower rate.
  • Tax-deferred compounding
  • Your Social Security contributions and benefits will not be impacted by your 401(k) plan.
  • You may access your money in emergency situations. While it is best to leave your 401(k) money until retirement, you can typically access the money for things like buying a house, college fees, or in some hardship situations with most plans.
  • The 401(k) plan is often transferable, meaning it can be taken from job to job by a rollover option.

Disadvantages:

  • Distributions prior to age 59½ are typically subject to a 10% penalty tax from the Federal Government
  • Distributions from these accounts must begin by April of the year following attainment of 70½
  • There is no "guaranteed benefit"; that is, investment risk rests with the employee

At Financial Network Limited, we can coordinate a client's entire 401(k) plan with our Third-Party Administrative and/or Payroll relationships. We work with many of the leading 401(k) providers (including the latest Open Architecture platforms) and can also provide solutions on a fee-only basis. We beleive that plan design is an extremely important component of a 401(k) program and can assist our clientele with decisions regarding cutting-edge strategies such as automatic enrollment, default investment options and target-date retirement funds.

Simple IRA

What is a Simple IRA plan? A Simple IRA plan is sometimes referred to as a "401(k) Plan on Training-Wheels" since it has many of the same characteristics of the 401(k). It is an employer sponsored retirement savings program that allows employees to make pre-tax contributions to their account. Since the plan is funded with pre-tax dollars that compound tax-deferred, a significant tax advantage can be realized and a substantial retirement account can be built. These programs are most commonly funded with individual participant accounts invested in mutual funds.

Employer contributions (pre-defined by the IRS) are mandatory to these types of programs. Most of the administrative hassles and costs (i.e. plan documents, non-discrimination testing, 5500 filings, etc) associated with 401(k) plans are not applicable to Simple IRA plans. In exchange for this reduced administrative burden, plan design flexibility is limited (i.e. no loans, no discretionary profit sharing, etc) by statute. Simple IRA plans are oftentimes a great retirement plan choice for small businesses or businesses looking for a plan which will not be burdensome to administer. In calendar year 2006, employees under age 50 can defer $10,000 annually to this plan and those employees age 50 and over can defer an additional $2,500.

At Financial Network Limited, we can provide Simple IRA plans on a fee-only basis utilizing a multi-manager approach as well as a traditional, single fund-family program.

Defined Benefit Pension Plans

Unlike a 401(k) Plan where an Employer's contribution is immediately known but the eventual retirement benefits available under the plan are not, a Defined Benefit Pension plan is designed to provide each participant with a specific income benefit at retirement. Under this type of plan, the Employer is responsible to provide these benefits to plan participants, regardless of investment performance and as such, the assets in these types of plans are directed by the Employer. Although not as popular with Employers as they once were due to the onerous actuarial requirements and lack of appreciation by employees (as they are often not portable, and often require a long-term period of employment with a single employer to generate a significant retirement income), Defined Benefit plans provide a significant level of retirement security to covered employees due to their guaranteed income streams.

Like other retirement plans, contributions when made to a defined benefit plan are deductible to the Employer and not taxable to the employee. In a defined benefit plan, annual funding requirements can vary greatly due to many factors such as earnings on previous contributions, participants’ current compensation, age-mix of participants, turnover in participants, actuarial assumptions and strategies as well as the minimum funding requirements of the IRS. In a closely-held entity, a Defined Benefit plan can oftentimes generate a contribution on behalf of the owner of the firm that is substantially higher than the allowable contribution in a defined contribution (i.e. 401k with profit sharing) plan would allow in a given year with identical compensation to the business owner.

At Financial Network Limited, our relationships with actuarial firms helps employers navigate through the various IRS and DOL regulations surrounding Defined Benefit Plans. As a service available from one of our preferred Actuaries, we work with a client to accurately forecast plan funding liabilities with their (proprietary) sophisticated modeling software and implement an investment strategy & portfolio suitable to meet the funding goals projected for the plan. We meet with our clients on a regular basis to review these portfolios and make adjustments as needed. Our defined benefit plan portfolios can be offered via insurance-based platforms (for clients who feel more secure with guaranteed account products), commission based products or via a fee-for-service model.

For clients who offer defined benefit plans alongside defined contribution plans such as 401(k)’s, we can coordinate both plans to include consolidated participant statements projecting future potential retirement benefits from Social Security, 401(k) plans and the Defined Benefits are available. Further, the administration and reporting for both plans would be coordinated & managed as well.