The Ultimate Guide to Retirement Plans for Lawyers

What Is a Law Firm Retirement Plan?

A law firm retirement plan is a type offered by some law firms. These types of plans are usually only offered by larger law firms. If your law firm offers it, you will likely be required to contribute to the plan. Your contributions will go into a fund used to pay retirees a fixed monthly income. There are many different types of retirement plans, but the most common ones used by lawyers are 401(k)s and pensions.

401k Retirement Plans

401k plan is an employer-sponsored retirement plan option that allows you to save and invest for retirement. You can contribute to your 401(k) with pre-tax dollars, which means your contributions will lower your taxable income. The money in your 401(k) grows tax-deferred, which means you will not have to pay taxes on the money until you withdraw it in retirement.

There are two types of 401(k)s: traditional and Roth. With a traditional 401(k), you contribute with pre-tax dollars, and the money grows tax-deferred. With a Roth 401(k), you contribute after-tax dollars, but the money grows tax-free. It means that you will not have to pay taxes on the money when you withdraw it in retirement.