In 2016, about 55 million Americans had an active 401(k) and as of 2018, these plans held $5.6 trillion in assets[1].  It’s no surprise that many employees are choosing to save for retirement by making contributions to an employer-sponsored 401(k) plan, as there are several advantages to utilizing this savings vehicle.
1. Tax-Deferment 
One of the more well-known benefits of a 401(k) plan is the ability to make a contribution on a pre-tax basis.  Typically, funds are automatically moved to your 401(k) through a payroll deduction, decreasing the total amount of your taxable income. When you eventually withdraw these funds, during your retirement years, you will be required to pay taxes on the distribution.  However, you will likely be in a lower tax bracket than you were during your working years, ultimately saving you more of your hard-earned money.
2. Matching Contributions
Many employers offer a matching contribution up to a certain dollar amount or percentage of an employee’s salary.  Essentially, as an employee, you are being given the opportunity to invest “free” money, helping you grow your 401(k) more quickly.  If your employer offers this perk, try your best to take full advantage by contributing at least enough to reach the maximum match.  Don’t make the mistake of leaving money on the table!  
3. Payroll Deductions
The ability to have funds automatically moved to your 401(k) through payroll deductions is an incredible benefit to employees.  Because the money never makes it to your paycheck, you are much less likely to spend it and instead, can let it work for you as an investment.  Offering the option for automatic contributions is just one way that employers can help their employees succeed when it comes to saving for retirement.  
4. Asset Protection
Most employer-sponsored 401(k) plans comply with the Employee Retirement Income Security Act (ERISA).  ERISA’s main goal is to set standards for most retirement and health plans and to “provide protection for individuals in these plans.”[2]  This means that should any financial trouble arise, the assets in your 401(k) plan will be protected from creditors. If needed, the Human Resources department or 401(k) Administrator at your company will have more information regarding your specific plan and if it meets ERISA requirements.  
5. Professional Advice
Investing in a 401(k) is a great starting point to begin working with a financial professional.  Your employer may offer access to a professional who can assist you with your 401(k) plan, however it may be beneficial to outsource to a financial advisor.  He or she can not only help you with your 401(k) but can also help you focus on other investment opportunities and create a more complete personalized plan for the future. Howard Capital Management, Inc. (HCM) is proud to offer the 401(k) Optimizer®, an easy, automated online tool to help you manage your retirement investments (401(k), 403(b) or 457). Using your risk tolerance level and long-term goals, the 401(k) Optimizer® generates personal portfolio allocation recommendations and recommends what to buy, when to buy and when to sell based on your plan’s investment options and market fluctuations.   Contact Howard Capital Management, Inc. A properly managed 401(k) can help maximize its growth potential and give you peace of mind about your retirement plan. The earlier you begin, the greater your return can be in the long-run.  In addition, a 401(k) can be a great stepping stone into other types of investments, allowing you to diversify your portfolio and balance your risk. By planning for your financial future now, you can make your retirement an exciting and smooth transition. Learn more about the 401(k) Optimizer® and have your questions answered by contacting Howard Capital Management, Inc. (HCM) to find an advisor in your area. [1] [2]


This communication is issued by Howard Capital Management, Inc. It is for informational purposes and is not an official confirmation of terms. It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to. Opinions expressed are subject to change without notice. Howard Capital Management, Inc. may maintain long or short positions in the financial instruments referred to and may transact in them as principal or agent. Unless stated specifically otherwise, this is not a recommendation, offer or solicitation to buy or sell and any prices or quotations contained herein are indicative only. Our proprietary indicator, the HCM-BuyLine®, identified changes in the market trend. Buys and sells may or may not have occurred on the exact dates shown. These dates do not necessarily reflect transactions applied to every individual account. Also, certain products, custodians and portfolios may have a delay in execution. When the HCM-BuyLine® indicates a bull market, HCM then identifies the particular mutual funds, ETFs or individual stocks that we believe have the best return potentials in the current market from the universe of assets available in each given program and invests in them. When the HCM-BuyLine® indicates a bear market, HCM moves clients’ investments to less risky alternatives. Not every HCM-BuyLine® buy and sell will result in a profitable trade. There will be times when following the indicator results in a loss. However, there have been situations in the past in which HCM reduced clients’ exposure to equities during market downturns by following an HCM-BuyLine® signal, thereby preserving capital. Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Howard Capital Management), made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Therefore, no current or prospective client should assume that the future performance of any specific investment or investment strategy will be equal to past performance level or that it will match or outperform any particular benchmark.  Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Howard.  To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. To the extent permitted by law, Howard Capital Management, Inc. does not accept any liability arising from the use of this communication. A copy of Howard’s current written disclosure statement discussing our advisory services and fees are available on our website LASS.102820 HCM.102820.50