Self Directed Solo 401k – Get the Most Value Out of It
It’s no wonder that so many among the self-employed are turning to self-directed retirement accounts like the Self Directed Solo 401k to pave the way to a financially independent retirement.
Looking around – unstable stock markets, questions about monetary policy, worry about consumer prices – it’s not hard to see why so many Americans are worried about retirement. They’re not sure that all of the familiar institutions will be around to take care of them when they get old. These worries also apply to small business owners and entrepreneurs – the very people who help the economy run.
But just because you’re aware of accounts like these doesn’t mean you’re necessarily getting the most use out of them. If you’re going to effectively plan for retirement, you’re going to have to know the makeup of these accounts, their restrictions, and how to take advantage of their benefits to squeeze the most investment value from your Self Directed Solo 401k. Here are a few tips for accomplishing just that:
Knowing the Benefits of the Self Directed Solo 401k
If you’re new to the concept of having a 401k on your own, then you need to know the basic benefits. You’d be amazed at what you can accomplish when using this kind of retirement account:
- Annual contributions can be as high as $53,000, allowing you to go far beyond what’s typically allowed in, say, a Roth IRA. If you’re already over the age of 50, you get a “catch-up” contribution that’s as high as $6,000.
- You can borrow from this account for any purpose, which helps if you have the cash flow to pay off a loan but need some additional capital. You can borrow up to $50,000 or 50% of your account value—whichever is less.
- “Checkbook control:” You might have the option to exercise what’s known as “checkbook control” over these funds, which allows you a high degree of financial freedom. If you work with American IRA, for example, we would essentially serve as the record keeper.
- Through self-directing, you’ll have access to a number of investment types, including real estate, precious metals, tax liens, limited liability companies, and more.
Needless to say, most investors who need to put away a lot of money for retirement see these benefits and advantages and know immediately that a Self Directed Solo 401k is for them. But is it for you? Let’s take a look at your investment style.
Your Investment Style: Does it Fit?
Many entrepreneurs who are self-employed and eligible for this kind of retirement account already have an independent streak in them; they like living life on their own terms and being in control of their financial destiny. For that reason alone, many of them consider the Self Directed Solo 401k to be exactly what they were looking for.
One of the most obvious benefits of this retirement account is the high annual contribution limits. People who have a lot of money to put away need this kind of benefit in order to get the most from their retirement account; if a different type of investment account like a Roth IRA hasn’t been “cutting it,” then this kind of 401k might be exactly what the retirement doctor ordered.
If you think that this kind of retirement account might be what the retirement doctor ordered for you, then you’ll want to get in touch. You can read more about these retirement accounts or simply call us at 1-866-7500-IRA (472) to learn more about these accounts and how they might be able to help you implement a retirement strategy that makes sense for you.