Self-employed? Consider opening a Solo 401(k)

The ranks of the self-employed are growing by the day.  It's estimated that more than 42 million Americans earn some form of full-time or part-time income.

If you're self-employed, with no other full-time employee other than a spouse or business partner, you might consider opening a Solo 401(k).  

Plans are easy to open, inexpensive, and far more generous than a Traditional IRA or SEP-IRA.

Here are the numbers.  In 2019 you can contribute up to $56,000 or $62,000 if you're 50 and older.  With a Solo 401 (k) you contribute both as employer and employee.  The employer portion of your contribution is always pre-tax.  The employee portion of your contribution can either be pre-tax or post-tax like a Roth.  If your spouse works for you, they too can contribute up to these limits based on their compensation.  

A small business owner with a high deductible health plan might also want to consider opening a health savings account (HSA).  HSA's are the only triple-tax-advantaged savings vehicle available to individuals.  Combining a Solo 401(k) and HSA can really maximize your tax and retirement savings.

If you would like to learn more about how a Solo 401(k) or HSA can lower your taxes and help maximize your retirement savings, please contact me at gadowney@lindenwm.com.

As a fiduciary and fee-only advisor, I don't make money by selling financial products.  I'm free to recommend the strategies and investments that make sense for couples and individuals, based on a clear understanding of where you're headed in life.  

If an open conversation of this kind will be helpful to you, request an appointment now.  Feel free to call out any specific questions you'd like me to address.

http://www.lindenwm.com/contact

*This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel. Neither the information presented nor any opinion expressed constitutes a representation by us of a specific investment or the purchase or sale of any securities. Asset allocation and diversification do not ensure a profit or protect against loss in declining markets. This material was developed and produced by Advisor Websites to provide information on a topic that may be of interest. Copyright 2014-2018 Advisor Websites.