Your Business Can Do More Than Generate Income
For many business owners, the business is their largest asset.
It’s also where most of their financial risk lives.
If your wealth is tied almost entirely to your company, then your future depends on one investment succeeding—your business.
A retirement plan helps change that.
A properly designed 401(k) allows you to use business revenue to gradually move wealth out of your business and into diversified investments over time.
Think about what that accomplishes simultaneously.
1. Diversify Your Wealth
Every dollar contributed to your retirement plan is another dollar that isn’t dependent on the future value of your business.
Instead of having nearly all of your net worth concentrated in one company, you’re building ownership in thousands of businesses through professionally managed investment portfolios.
Over time, that diversification can significantly reduce financial risk.
2. Potentially Reduce Current-Year Taxes
Contributions made through your business are generally tax-deductible.
As of 2026, many business owners can contribute up to $72,000 annually to a qualified retirement plan, depending on their circumstances.
For an owner in roughly a 30% combined federal and state tax bracket, that contribution could reduce current-year taxes by approximately:
$72,000 × 30% = $21,600
Tax savings could grow to approximately:
$432,000
That’s over twenty thousand dollars that may remain working for your future instead of being paid in taxes today. Actual tax savings depend on your tax situation and plan design.
3. Invest in Your Future Income
A retirement plan doesn’t just reduce taxes today.
It creates tomorrow’s income.
Consider a business owner who contributes $72,000 each year for 20 years, earning an average annual return of 10%.
- Annual contribution: $72,000
- Years invested: 20
- Assumed annual return: 10%
The account could grow to approximately:
$4.1 Million
That’s before considering any future increases in IRS contribution limits, catch-up contributions, or additional retirement plan strategies.
The point isn’t simply accumulating a large account balance.
It’s creating an asset that can one day generate retirement income that isn’t dependent on selling your business.
One Decision. Three Benefits.
A well-designed retirement plan allows your business revenue to work in multiple ways at the same time.
Instead of simply flowing through your business and eventually becoming taxable income, a portion can be redirected toward building your personal financial future.
You are simultaneously:
- Diversifying beyond your business.
- Potentially reducing taxes today.
- Building future retirement cash flow.
That’s a rare combination.
It’s one of the few financial strategies that can improve both your current and future financial position.
That’s why retirement plans are one of the most valuable planning tools available to business owners—and why we’ve made them a core part of the services we offer at Oberdorfer Financial.
Truly,
Matt Oberdorfer
Founder & Financial Advisor
Oberdorfer Financial at OBFI.com
Personal Wealth × Business Wealth
Planning • Investing • 401(k)s
Financial planning and asset management that helps coordinate your financial life—bringing together personal wealth, business wealth, real estate, taxes, retirement, and specialty advice to improve your long-term financial trajectory.
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Disclaimer: This content is for informational and educational purposes only and should not be considered investment, tax, legal, or insurance advice. Asset location strategies are not appropriate for every investor and should be evaluated based on individual circumstances. Investing involves risk, including the possible loss of principal. Past performance does not guarantee future results.
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