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Retirement Plans For The Self-Employed
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Article 1: Overview Of Retirement Plans
For decades the self-employed were at a disadvantage in retirement savings. Costs and paperwork hassles made standard 401(k) plans popular in the corporate world impractical for the self-employed.
But recent changes in federal laws and additional proposed changes are allowing the self-employed some attractive retirement savings options. Among new options are the “Solo” or “Independent” 401(k) and the pending Lifetime Savings Accounts.
The challenge now is not how to prepare for the golden years, but choosing between several increasingly attractive retirement savings options:
To determine what fits your situation best, you’ll need to analyze their respective contributions limits, tax benefits and legal restrictions. This seminar will help.
Perhaps the best news to date for the self-employed was the Economic Growth and Tax Relief Reconciliation Act of 2001. It created the option of a one-person 401(k) plan empowering a business owner to make substantial and flexible retirement contributions.
These so-called “solo” 401(k) plans permit contributions of up to $42,000, compared to the previously more restrictive maximum deductible contribution through profit sharing plans. The solo 401(k) also eliminates administrative and set-up headaches.
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