If you’ve ever wanted to “invest like an entrepreneur,” then there’s one simple course of action that you might consider: the Self-Directed Solo 401K plan.
These plans are available for sole proprietorships, unincorporated and incorporated businesses and more, and they’re designed to provide you with many of the benefits of a Solo 401K plan without having to go through your employer in order to secure it.
But why do entrepreneurs choose the Self-Directed Solo 401K plan so often? The answer is multi-faceted, and we wouldn’t be able to provide you with a single answer. That’s why we’ll list five reasons entrepreneurs are so enthusiastic about these retirement plans:
Reason #1: More investment control. You might have noticed the phrase “Self-Directed” in “Self-Directed Solo 401K.” That’s not there by accident. A Self-Directed IRA offers you plenty of flexibility for choosing your financial future, giving you the responsibility to choose which investments are made. If this sounds intimidating, remember that many investments aren’t very difficult to make once you have a little know-how.
Entrepreneurs like being in charge of their employment future, so it stands to reason that they like being in charge of their financial future as well. That’s one reason Self-Directed IRAs are so popular with the go-getter type. The only question you have to ask is: do you feel the same way?
Reason #2: Higher contribution limits. If you have a different type of IRA, such as a Roth IRA, you might notice that your contribution limits are a little, shall we say, modest. With the Self-Directed Solo 401K, contributions limits are much higher, allowing you to put aside a more significant portion of your income towards retirement—and as any savvy investor knows, the more you invest, the more potential there is for growth.
Reason #3: They’re great for older entrepreneurs who want to “catch up.” You don’t have to be 20 years old to start a successful retirement portfolio that will grow over time. In fact, many entrepreneurs and individuals well past fifty years old will utilize the Self-Directed Solo 401K in order to take advantage of higher contribution limits and put their retirement portfolio in “head start” mode. You may want to look into your potential contribution limits if you’re at age 50 or over.
Reason #4: Flexibility. When you self-direct your retirement account, you’d be surprised at the amount of flexibility afforded to you. You’ll have a greater say over your investment and you’ll be able to control it directly, which ensures that you can construct the overall retirement portfolio that you’re after. Flexibility means having the range of options available to you to make the best choice—and sometimes these choices simply aren’t as easy to make if you don’t self-direct the account.
Reason #5: To build a retirement portfolio you can count on. With social security feeling “up in the air” for future generations, it’s entirely prudent to establish a hefty, generous retirement portfolio that will help ensure that your finances are protected for years and decades to come. Although entrepreneurs can have unstable incomes, the one stable portion of their financial life can be retirement. If you want to make that choice, then you should also consider a Self-Directed Solo 401K.
Learning more about the Self-Directed Solo 401K isn’t difficult—simply browse our site here and find what you need, or contact us at 866-7500-IRA(472). You’ll be able to find out more information about these intriguing retirement accounts and find out if you’re the right kind of fit and, most importantly, whether or not you potentially qualify for a Self-Directed Solo 401K.