How to Get a 401(k) Even if You’re Self-Employed

By Heather Taylor0 Comments

We’re constantly educating people about the self-directed IRA – the retirement account that allows you to invest in a variety of options, including real estate, notes, tax liens and more.

Another retirement savings vehicle that might be underutilized is the Solo 401(k). Many people think the 401(k) is only available if you work at a company that offers this option, but you can qualify for an account even if you’re self-employed.

The Solo 401(k) is open to qualified individuals who:
  • Are self-employed or an independent contractor
  • Employ only themselves and, if applicable, a spouse – there can’t be any other employees
Other things to know about the Solo 401(k):
  • You can contribute as much as $17,500 in salary deferral to a Solo 401(k), the same limit as a regular 401(k)
  • With a 401(k), an employer can match your contributions. With a Solo 401(k), you are the employer, so you can contribute a match, as long as the total contribution doesn’t exceed $52,000 during the year
As an article on nerdwallet.com points out, you don’t have to be working “full-time” to be eligible for a Solo 401(k). If you have a full-time job but do freelance work on the side, you might still qualify.

Find out if the Solo 401(k) is a viable retirement savings option for you. Schedule a free one-on-one IRA checkup with one of our Senior Account Executives.