Retirement Vehicles for Business Owners
Self-employed retirement planning is dramatically different from W-2 retirement planning — and more powerful, if you know the rules. Solo 401(k)s, SEP IRAs, Keogh plans, defined benefit plans, SIMPLE IRAs, and catch-up contributions.
Guides
Defined Benefit Plan for High-Income Owners: Supercharging Retirement at Age 50+
For business owners in their 50s or 60s earning $300,000 or more annually, the defined benefit plan is the single most powerful tax-deferred retirement vehicle in the tax code. It can allow annual deductible contributions of $150,000 to $300,000 or more —…
SIMPLE IRA: Best for Small Businesses with Employees
Once a business has W-2 employees beyond just the owner and spouse, the retirement plan conversation changes. SEP IRAs stop being flexible (the same-percentage rule forces proportional contributions for all eligible employees). Solo 401(k)s stop being…
Deep Dives
Solo 401(k): Contribution Limits (Employer + Employee) and Roth Option
The Solo 401(k) — also called the Individual 401(k) or One-Participant 401(k) — is the most powerful retirement vehicle available to self-employed people and owner-only businesses. It allows the owner to wear two hats: as the employee (making elective…
Keogh Plan: When It Makes Sense (and When It Doesn't) vs. SEP or Solo 401(k)
If you've been reading about retirement plans for self-employed people and come across references to "Keogh plans," you've encountered a term that used to be important and is now mostly a historical artifact. Keogh plans still exist. They still appear in IRS…