Solo 401(k)
A 401(k) plan designed for self-employed individuals with no employees (other than a spouse), allowing both employee and employer contributions up to $69,000 ($76,500 for age 50+) in 2024.
Understanding Solo 401(k)
The Solo 401(k) allows self-employed individuals to contribute as both employee ($23,000/$30,500 for 50+) and employer (up to 25% of compensation), potentially reaching the $69,000 combined limit. The high contribution limit makes it one of the best retirement accounts for self-employed high earners. Combining a Roth Solo 401(k) with an IUL provides both immediate and long-term tax optimization.
Why This Matters for Retirement: Understanding Solo 401(k) is essential for making informed decisions about tax-free retirement income strategies. Whether you are evaluating an IUL policy, planning Roth conversions, or comparing retirement vehicles, this concept directly affects your outcomes.