Case Study: Tax Planning Considerations for High‑Earning Business Owners in Minnesota Approaching Retirement
- Will Grant
- 21 hours ago
- 3 min read
The Problem
360 Financial partners with a married couple in their sixties—high-earning, long-time business owners seeking proactive financial guidance.
The husband leads the business, with his wife actively involved in daily operations. As they entered their peak earning years—about five years from retirement—their primary concern shifted to managing a growing annual tax bill.
Their increased income was a positive milestone, yet it brought a higher tax burden. Together, we explored strategies to reduce taxes while seeking to ensure continued progress toward a confident retirement.
As a CERTIFIED FINANCIAL PLANNER™ and Certified Private Wealth Advisor®, Will helps clients pursue their ideal life through values-based financial planning. He tailors his process to help each client achieve their objective, whether they want to prepare for retirement, work to ensure smooth business succession, fund education, implement wealth transfer strategies, or navigate other impactful financial events.
The Strategy
360 Financial recommended retirement plan structures tailored for business owners and ensured these strategies aligned with their professional and personal goals.
First, we guided them to maximize the benefits of a solo 401(k). Since both spouses are involved in the business, they qualify as a team, enabling contributions as both employees and employers.
This approach allowed them to contribute the maximum as employees and make additional employer contributions, thereby lowering both personal and business taxable income.
They built a strong foundation for retirement planning through disciplined solo 401(k) contributions.
In addition, we established a cash balance plan—a separate retirement vehicle that allows high pre-tax contributions. High-income individuals nearing retirement can make additional six-figure annual contributions with this plan and directly reduce their taxable income.
Cash balance plans, however, require consistent commitment.
When you establish a plan, you commit to a minimum annual contribution and have limited flexibility to adjust it each year. We carefully reviewed their cash flow and selected a contribution level they felt confident they could maintain.
Why This Worked
This strategy succeeded because we tailored it to their unique situation.
They are both high earners with stable income, nearing retirement, and able to commit to consistent contributions. The solo 401(k) gave them flexibility and substantial tax advantages early on. The cash balance plan added another powerful layer by allowing them to shelter significantly more income from taxes during their highest-earning years.
We worked to ensure they understood each trade-off and felt empowered in every decision.
A cash balance plan works best if you have a predictable income and can maintain consistent contributions. By selecting a level that fits their cash flow, we built a sustainable, reliable strategy together—helping them feel confident about their retirement.
Disclaimer: This is a hypothetical situation based on real-life examples. Names and circumstances have been changed. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investments or strategies may be appropriate for you, consult your advisor prior to investing.
Other Articles and Guides
About the Author
William Grant
Will Grant enjoys empowering people to make informed decisions and seeing the positive impact his guidance can have on their lives.
Prior to joining 360, he spent seven years serving hundreds of clients at a boutique RIA focused on healthcare executives with equity compensation and then at a large, independent RIA. He earned a Bachelor of Science degree in Finance from Miami University and holds his Series 7 and 63 licenses through LPL Financial and his 65 license through 360 Financial.
Will lives in Minneapolis with his fiancée, Melissa. In his free time, he enjoys competing in triathlons, golfing and is an active member of the Minnesota Leadership Council for the Chick Evans Scholarship Foundation, of which he was a recipient.
Schedule a Call
At 360 Financial, our clients come first. You deserve personalized attention. You’ll be happier and more confident in your financial future when you have an advisor who always puts your needs and best interest first. Schedule a 15-minute introductory call with a 360 financial advisor to see how we can help with your retirement, succession, tax, and estate planning.
About 360 Financial
360 Financial is an independent wealth management firm with a team of specialized financial advisors and financial planners. As fiduciaries, 360 Financial’s advisors provide services to business owners, entrepreneurs, and professionals. We help investors with sudden wealth, retirement planning, tax planning, estate planning, and business financial planning.
Headquartered in Minnesota, we serve investors across the US with online and in-person wealth management and financial planning services.
