Retirement Plan Options For Self Employed People #24
When it comes to planning for retirement, most people can rely on some type of plan through their employer - but what about people who are self-employed? How do small business owners, contractors, and everyone in between make sure they are planning for their retirement? Believe it or not, there are several options for self-employed people when it comes to setting up a retirement plan. I don’t want to leave hardworking men and women like you without a guide when it comes to retirement. Make sure to pay close attention to this informative episode, you don’t want to miss it!
You will want to hear this episode if you are interested in...
How much should you be saving for retirement? [1:20]
Setting up a ROTH IRA or a Traditional IRA. [2:30]
What is a Solo 401k? [4:30]
Creating a SEP IRA, pros, and cons. [9:45]
How to use a Simple IRA. [11:00]
The defined benefit plan or pension plan. [12:30]
5 Retirement Options
Most people are unaware that there are specific options available when it comes to retirement planning for self-employed people. Did you know the options that are available on the marketplace? Here is a brief overview of the five retirement options that are available for the self-employed.
Traditional or Roth IRA (individual retirement arrangement). A Roth IRA allows qualified withdrawals on a tax-free basis provided certain conditions are satisfied. Roth IRAs are similar to traditional IRAs, with the biggest distinction between the two being how they’re taxed.
Individual or Solo 401k. You can make significant contributions toward your retirement with an Individual 401(k) plan. It’s easy to administer and has many of the same benefits as a traditional 401(k). Best of all, you direct how your contributions are invested.
SEP (Simplified Employee Pension Plan) IRA. A SEP plan allows employers to contribute to traditional IRAs (SEP-IRAs) set up for employees. A business of any size, even self-employed, can establish a SEP.
Simple IRA (Savings Incentive Match Plan for Employees). This option allows employees and employers to contribute to traditional IRAs set up for employees. It is ideally suited as a start-up retirement savings plan for small employers not currently sponsoring a retirement plan.
Defined benefit plan. A defined benefit plan is a qualified employer-sponsored retirement plan. This means they are qualified to receive certain tax benefits under the law, like tax-deferred investment growth or tax deductions for contributions.
Which plan do you suspect is the right one for your retirement strategy? When was the last time you re-evaluated your goals and objectives? Learn more about this critical topic by listening to this episode!
Don’t wait, start planning today!
With the New Year just around the corner, it’s a good excuse as any to make sure you have your financial plans in order. Sure, you might not have enough in your budget to save and plan as you’d like but starting is half the battle! If you are serious about setting yourself and your family up for long-term financial success, you’ve come to the right place. As we look ahead to the new year, I am excited to continue to bring you accurate, and valuable financial insights that will help you thrive!