Asked by Alan  |  Submitted August 19, 2014

How does a solo 401k work? How do you qualify for it?

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  Answers  |  3

August 19, 2014

I would suggest you review this link to the IRS and also consult your accountant http://www.irs.gov/Retirement-Plans/One-Participant-401(k)-Plans. It is a 401K plan for a solo business owner (with no employees) or the owner and spouse exclusively. A couple of features I like about the solo 401K is that in some instances you could contribute more than you could to a SEP, and you can borrow against it.

$commenter.renderDisplayableName() | 01.24.17 @ 03:25

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September 02, 2014

A solo 401k allows you (and your spouse) to establish a 401k for your business when no other statutory W-2 employee's exist. Many solo plans are offered at very low costs compared to other retirement plan options, but you'll need to be careful about hidden fees, undisclosed 12(b)1 costs, and the like. Contribution levels are higher than most other options except for solo pensions plans or cash balance plans which may be more appropriate for your needs. Feel free to contact me for more assistance.

$commenter.renderDisplayableName() | 01.24.17 @ 03:25

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July 08, 2015

Also, make sure that you are working with a financial professional who can help you make better financial decisions for your business and household. Too many companies are "one trick ponies" that sell a certain product whether it's right or wrong for the client. You need to have a good understanding of your financial position. You need to be organized financially as well. Finally, you must have financial protection. Then and only then should you start considering investments in the market. A 401k may not be right for you and your business. There are many other programs that might more successfully accomplish what you desire to, and you need a financial professional for that. Someone who knows the "rules" and can access all of the tools needed to accomplish that.

Feel free to contact me if you have further questions.

$commenter.renderDisplayableName() | 01.24.17 @ 03:25

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