OVERVIEW There seems to be some confusion around what business entities are eligible to open a solo 401k account. Because it’s called a “solo” 401k, and also often referred to as an individual 401k or a one-participant 401k, many people assume that the plan is only for sole proprietors. False. Whether you operate as a sole proprietorship, […]
OVERVIEW & FAQ A solo 401k loan lets you tap into your solo 401k account and borrow money from your own nest egg. Essentially, you’re lending money to yourself, with the requirement to pay it back. It doesn’t sound like a great deal, but it can make a lot of sense in certain cases. Plus, a solo […]
OVERVIEW A rollover is the fastest, most effective way to fund your solo 401k account. You’re allowed to rollover funds from almost any retirement account, and there are no limits on how much you can rollover. If you’re considering a solo 401k rollover, let’s go through how it works and why you should consider one. […]
OVERVIEW The solo 401k and SEP IRA are retirement accounts created for small business owners and self-employed individuals. Both have the same contribution limits, offer tax-free compounding on investments, and all business entities are eligible. A solo 401k offers more tax advantages than a SEP IRA, but has stricter eligibility requirements. Depending on your business, one might make […]
SIMILARIES DIFFERENCES Both the Roth Solo 401k and the Roth IRA are funded with post-tax dollars. You contribute with income that’s already been taxed, but you don’t pay any taxes when you withdraw from either of the two accounts in retirement. In other words, your money compounds tax free, and then you get to keep […]
OVERVIEW What is a Roth solo 401k? A Roth solo 401k is essentially a Roth 401k account for the self-employed. A solo 401k has two different accounts within the plan: A traditional solo 401k account and a Roth solo 401k account. A Roth solo 401k is simply a type of solo 401k account. For example, there’s […]
E-Trade offers one of the best free solo 401k plans. It comes with both a pre-tax and Roth option, allows solo 401k loans and rollovers, and a wide variety of investment options into traditional asset classes like stocks, bonds, and mutual funds. While it’s free for online US-listed stock, ETF, mutual fund, and options trades, […]
TD Ameritrade also offers a free solo 401k plan. There are no set up fees, or any annual maintenance fees to hold your account, and all regular trades within the solo 401k are $0 per stock, ETF, and option trade. The solo 401k offered by TD Ameritrade comes with a pre-tax account, but no Roth […]
The Charles Schwab Solo 401k Plan is another free prototype solo 401k plan that offers free account set ups, free trades, and no maintenance fees. Being free does have its trade offs. You don’t get a Roth option, no ability to do a mega backdoor Roth, no access to alternative investments, and you still have […]