Locke Lord Retirement Savings Plan

 

Resources Charles Schwab Home Page Schwab Retirement Plan Highlights Schwab Enrollment Guide 2023 Summary Plan Description Summary of Material Modifications Schwab OnDemand Webinar – “It’s My Retirement, How Do I Get the Most Out of My Plan” Auto Enrollment and Qualified Default Investment Alternative Notice Annual Fee & Investment Notice – Oct. 2023 IRS Required Notice to Interested Parties regarding IRS Determination Letter for Locke Lord Retirement Savings Plan IRS Required Notice to Interested Parties regarding IRS Advance Determination Letter for Edwards Wildman 401(k) Savings Plan IRS Required Notice to Interested Parties regarding IRS Advance Determination Letter for Edwards Wildman Retirement Savings Plan

The Locke Lord Retirement Savings Plan is designed to help you save now for your financial needs during retirement. You can tailor your retirement savings program to help you meet your individual goals and anticipated needs during retirement.

HOW THE RETIREMENT SAVINGS PLAN WORKS
Team Members and Non-Partner Attorneys
Through the plans, you may:

• Save a portion of your pay for retirement (for 2024 the limit is $23,000 or, if you are age 50 or older, $30,500)
• Lower your current tax bill because your contributions are not taxed when you make them
• Make after-tax ROTH contributions
• Invest your before-tax contributions in any or all of the Plan’s professionally-managed investment funds

Partner Contributions
You may make a voluntary 401(k) contribution up to the annual IRS dollar limit (for 2024 this limit is $23,000 or, if you are age 50 or older, $30,500).  Each year, the Executive Committee determines what the profit sharing contribution formula will be (usually it is a percentage of a partner’s income, with the contribution capped at $46,000). Starting in your first full year, you will make a profit sharing contribution in addition to your voluntary contribution (if any). Therefore, your total maximum annual contribution to the plan may be as much as $69,000 ($76,500 if you are age 50 or older). We have a number of investment choices including mutual funds, portfolios and self-directed accounts that allow you to invest in publicly traded investments.

HOW CONTRIBUTIONS AFFECT YOUR TAX BILL
Because your contributions are deducted before your taxes are figured, less of your income is taxed. By reducing your taxable income, your spendable income may be higher than if you saved money for retirement somewhere else.

Let’s look at an example:

	If You Contribute to the Retirement Savings Plan	If You Contribute to an After-Tax Mutual Fund Account
Your monthly pay	$2,500	$2,500
Your before-tax contributions (5%)	$125	$0
Your taxable pay	$2,375	$2,500
Your income taxes (15%)	$356	$375
Your Social Security taxes (7.65%)	$182	$191
Your take-home pay	$1,837	$1,934
Your mutual fund account contributions	$0	$125
Your spendable income	$1,837	$1,809
Your tax savings	$28 per month $336 per year	N/A

Your contributions to the Locke Lord Retirement Savings Plan will be taxable as ordinary income when you withdraw them. However, most people are in a lower tax bracket after retirement, so you may pay less in taxes than you would now. This may save you even more money in the long run.

Roth 401(k) After Tax Option
ROTH 401(k) contributions offer you the option of deferring after-tax dollars. Distribution from a ROTH account, including investment earnings, may be tax free if you meet the criteria of being 59 1/2 and had the account established for 5 years prior to distribution.

Plan Enrollment
New hires will automatically be enrolled in the Retirement Savings Plan with a 3% deferral after 45 days of hire.  You can enroll any time through workplace.schwab.com or call Participant Services 1-800-724-7526.  Existing employees can start making 401(k) contributions by logging into the Schwab Retirement Plan website.

OWNERSHIP OF YOUR ACCOUNT
You are always 100% vested in the value of your own contributions, rollover contributions and Firm profit sharing contributions and the earnings they generate.

Please note that even if you are 100% vested, there may be tax consequences if you withdraw money before retirement, so consult a tax adviser before taking any money out of the plan.

 

THE RETIREMENT SAVINGS PLAN MAKES SAVING AND INVESTING EASY The Retirement Savings Plan is designed to encourage you to save for retirement and build for the future by making saving and investing easy. It’s automatic—Your contributions are automatically deducted from your paycheck. You don’t have to remember to write a check each month. It’s profitable—When Locke Lord contributes to your account, it’s like getting an additional contribution that doesn’t cost you a penny! It’s tax-deferred—Your contributions are deposited in your account before taxes come out. This lowers your taxes so you can afford to save more. It’s available—You may take out a loan of up to 50% of your vested account balance if you need access to additional money. Loans can be from a minimum of $2,500 to $50,000 and must be repaid through payroll deduction of up to five years (or 20 years if you are using the money to buy your primary residence). All interest is paid back to your account— not to a bank! It’s yours—You decide how to invest your account based on your goals and the amount of risk you want to take. If you leave Locke Lord for any reason, you can cash out your vested account balance, reinvest it or leave it where it will continue growing tax-deferred.

 

If there is ever a question about this benefit, or if there is a conflict between the information in this summary and the formal language of the Plan documents, the formal wording in the Plan documents will govern. Please note the benefits described in this summary may be changed at any time and do not represent a contractual obligation on the part of Locke Lord LLP.