Solo 401k

[Arif]

We are in the process of formalizing our side business. It will our sole source of income next year. I plan to set up a solo 401k for me and my wife (everyone else will be contracted out). Is there a company that I can set up a 401k in that will allow us to invest in individual stocks like an IRA can? Also, has anyone heard any more news on the solo 401k? Thanks.

 

[kat]

I'd suggest checking out Fidelity Investments. I know they offer a solo 401(k) plan. It's worth a call to see if they offer what you want. I'll be doing it soon too. I found some basic info at their website and asked them to mail some. When I began looking earlier this year, someone also recommended T Rowe Price, but I didn't follow up since I already had another account at Fidelity. Nearly all my assets are at Vanguard, but they don't offer the solo 401(k).

kate

 

[TromboneAl]

When I looked into that I found that a SEP-IRA was much much simpler, and still let me contribute a lot. Just like an IRA and up to 15% of income (max $25,500). You can convert that to Roth also.

 

[Arif]

Thanks kat,
They do allow you to invest in individual stocks which is what I am interested in.

Trombone,
Everything I have read thus far says that you can contribute a lot more to a solo 401k than a SEP-IRA.

 

[retire@40]

When I looked into that I found that a SEP-IRA was much much simpler, and still let me contribute a lot.  Just like an IRA and up to 15% of income (max $25,500).

Isn't the max higher than 15% for a SEP-IRA?

 

[vic]

SEP limit is 25% with a max of something like 40K

There is a solo 401K company that offers all Vanguard stuff for a 0.5% yearly fee, can't remember the name no more. Solo 401K is much more of a hassle to set up and maintain with the IRS regulations than SEP

 

[brewer12345]

We set up a solo 401k with Fido last year for my wife's business. Easy to set up, easy to maintain, and Fido didn't charge us any fees to do it. You can buy and sell anything you like within the 401k at Fido (subject to retirement account restrictions).