It’s important for investors—including independent contractors—to know that they have plenty of options for protecting their assets and making large contributions that provide them with ample opportunity to grow that wealth into a large retirement nest egg.
Charlotte, NC (PRWEB)
September 18, 2017
For independent contractors, the idea of substantial retirement savings in a protected IRA or 401(k) plan might seem like it’s reserved for those with employers and benefits. But as Jim Hitt, CEO of American IRA in North Carolina, recently explained at the American IRA blog, there is a powerful alternative for those who work for themselves: the Self-Directed Solo 401(k) plan.
This type of plan is much like other 401(k) plans in that it has high limits for retirement contributions, allowing independent contractors to put aside large amounts of money with the protections of a retirement account. There are some additional requirements and restrictions for the Self-Directed Solo 401(k) plan, however, to which investors will want to pay attention.
Which advantages does a Self-Directed Solo 401(k) confer on an independent contractor? In the article posted at http://www.AmericanIRA.com, Jim Hitt explained that these include the ability to self-direct one’s own investments, including making investments in LLCs, private equity, and even rental real estate properties. For independent contractors who want to see aggressive growth from their 401(k) plans, these investment opportunities can represent important vehicles for future expansion.
Jim Hitt also pointed out the high contribution limits. A Roth IRA, for example, tends to have low contribution limits at just $5,500 a year—depending on an individual’s circumstances. The Self-Directed Solo 401(k) plan, however, can see a contribution maximum of $54,000, which is a tremendous way for the self-employed to catch up on their retirement contributions if they haven’t made them to a large degree in their younger years.
“Independent contractors sometimes feel as though they’re on the outside looking in when it comes to retirement,” said Jim Hitt. “It’s important for investors—including independent contractors—to know that they have plenty of options for protecting…