Self-employed retirement plans Anchorage, AK. The independence of being your own boss in Anchorage, AK is one of the greatest advantages of working for yourself. That said, this independence sometimes brings with certain challenges, particularly when it comes to building your retirement fund, because you don't have the benefit of a workplace retirement plan. Only 13% of self-employed individuals have a workplace retirement plan, although many would be better off understanding their retirement options. In addition to having a more comfortable retirement, seeking advice from a financial advisor in Anchorage, AK to set up your self-employed retirement plan can provide significant tax advantages that help both you and your business to thrive.
Few Anchorage, AK financial advisory and retirement planning firms understand the needs of self-employed individuals quite like Correct Capital. The father of our founder was a small business owner himself (check out our story here), and we are deeply experienced in helping businesses with their retirement planning needs. We know that your professional and personal aspirations go far beyond just monetary concerns, and we strive to create customized solutions to meet your unique goals. Read on to discover about your self-employed retirement plan options in Anchorage, AK, or give us a call at Correct Capital at 877-930-401k or contact us online to talk to a small business financial advisor in Anchorage, AK today.
Why Anchorage, AK Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals are essential for preparing you for the future, they also deliver tangible benefits today. From flexible contributions to significant tax savings, working with a financial advisor in Anchorage, AK enables you to create your retirement plan to align with your individual circumstances.
Flexibility That Fits Your Income
For those with fluctuating income from year to year, a plan like a SEP IRA or Solo 401(k) gives you the option to tailor how much you save:
- Customizable Contributions: Save extra during high-income years and reduce savings when your earnings dip, ensuring your plan works with your cash flow.
- Roth Options: Opting for a Roth Solo 401(k) lets you pay taxes on contributions now, so you can withdraw without tax penalties in the future—a wise move if you believe your tax rate is likely to rise in the future.
Save Money on Taxes
Plans designed for the self-employed offer powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a Solo 401(k) shrink your tax liability, allowing you to keep more of your earnings.
- Tax-Deferred Growth: Investments grow tax-free until withdrawal, giving your money more time to compound.
- State-Specific Incentives: Depending on where you live, you could qualify for extra tax breaks as a sole proprietor. These state-level incentives make these plans even more valuable.
- Retirement Savings Contributions Credit (Saver’s Credit): Eligible individuals can claim a tax credit of up to 50% of the first $2,000 they contribute a retirement plan, helping to lower your tax bill even more.
Protect Your Savings With Smart Investments
Creating a stable future goes beyond just how much you save—it’s also linked to the way you invest:
- Diversified Portfolios: Distributing your investments across a mix of asset classes like stocks and bonds is a smart way to reduce risk while continuing to build your savings.
- Emergency Back-Up: Supplementing your retirement savings with a dedicated business safety net ensures you don’t dipping into savings during challenging periods and facing tax penalties.
Plan for the Future of Your Anchorage, AK Business
Retirement planning also helps you think through what’s next with your Anchorage, AK business:
- Selling Your Business: If you’re planning to sell, accounts such as SEP IRAs or Solo 401(k)s remain your personal assets and don’t transfer with the business. These savings ensure the steady income you’ll need during retirement. It’s important to note that while selling your business results in a capital gain, retirement plan contributions are restricted by contribution limits (e.g., as much as $7,000 for IRAs or up to $70,000 for Solo 401(k)s, with catch-up contributions, depending on plan details).
- Minimizing Taxes: Making the most of retirement savings helps lower the taxes you are required to pay when you transfer your business.
- Succession Planning: If you’re passing the business on, your retirement accounts provide financial security through the transition. You might want to work with a financial advisor with expertise in succession and retirement planning to reduce taxes on the sale.
With the right retirement plan, you manage your financial future, lower your tax bill, and build a strong framework for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Anchorage, AK Now?
Time is one of the most important resources when it comes to saving for retirement. Getting a head start not only helps you grow a more substantial retirement fund but also lowers the stress of saving aggressively in the future. This is why it makes sense to begin today:
The Cost of Waiting
Waiting to start your retirement fund may cause a major impact on the savings you’ll have when you retire. The biggest reason is compound interest—the powerful process where your investments grow, and those returns, in turn, earn even more returns. The longer your money has to grow, the greater the effect of compounding.
Example: Alex and Taylor are both self-employed professionals. They each aim to save $500,000 for retirement by age 65:
- Alex starts saving $5,000 annually at age 30.
- Taylor delays savings until age 40 but saves $7,500 annually to make up for lost time.
By age 65, assuming 7% annual return:
- Alex puts in $180,000 and ends up with $691,184.39*.
- Taylor puts in $195,500 but achieves a total of only $474,367.78*.
How Early Contributions Grow
Small, consistent savings made consistently can lead to substantial growth. Take a look at this scenario showing the power of consistent growth:
- Starting at age 25: Putting aside $200 per month in a retirement plan with an average annual return of 7%, you’ll end up with $497,303.29* by age 65.
- Starting at age 35: Saving the same $200 per month would result in only $235,412.97* by age 65—a gap of over $260,000, just from a 10-year delay.
Saving early, the lower your annual savings needs each year to reach your retirement goals.
*The numbers shown in this scenario are estimates generated with NerdWallet’s Compound Interest Calculator, based on a 7% annual return. Annual deposits were multiplied by the number of years to estimate total contributions. The scenarios provided are meant to provide general guidance and are not a promise of future results. Your individual results may differ depending on factors such as market conditions, fees, and personal factors. We recommend consulting a financial advisor for personalized advice.
Take Control of Your Financial Future
For self-employed individuals in Anchorage, AK, it can be tempting to prioritize reinvesting in your business over saving for retirement. However, initiating a plan now enables you to:
- Leverage growth that is tax-deferred or withdrawals without taxes in the future.
- Benefit from contribution flexibility that change with your earnings.
- Create a financial cushion that offers peace of mind, no matter how your business evolves.
The sooner you start, the less you’ll be required to worry about making up for lost time later in life. Taking steps toward your retirement goals today means gaining control over your financial future and creating for yourself the freedom to focus on your objectives—both for your golden years and your Anchorage, AK business.
Types of Self-Employed Retirement Plans
Multiple retirement savings options available for entrepreneurs in Anchorage, AK, each providing its own benefits and trade-offs. A financial advisor will guide you to evaluate the advantages and disadvantages of each plan and choose the one most suitable for your needs. Generally speaking, your self-employed retirement plan options in Anchorage, AK include:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent long-term savings plans that offer distinct tax benefits. In a conventional IRA, the money you contribute is often tax-deductible, and returns grow free of current taxes, but withdrawals in retirement are taxed as income. In contrast, Roth IRAs require contributions from post-tax earnings, but retirement withdrawals that qualify, including earnings, are exempt from taxes. In both cases, withdrawals come without penalties as long as you are at least 59½.
Eligibility: While many retirement plans, such as 401(k)s, are tied to employment, both traditional and Roth IRAs are open to those with taxable earnings.
Contribution Limits: For 2025, annual contribution limits for IRAs remain $7,000, or $8,000 if you qualify for catch-up contributions.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: SEP IRAs is a retirement plan that allows self-employed individuals to set aside a portion of their self-employment income. Contributions must come from an employer, so, as a sole proprietor, you (the employee) are limited to contributions from the employer role more than the 25% you (the employer) have designated. If you have employees, it's required to contribute the same amount for them as you do for yourself. You have the flexibility to contribute a flat-dollar amount or a percentage of wages to employee accounts. This type of plan may be ideal for businesses that experience periods of inconsistent earnings. Compared to other retirement options, SEP IRAs are free of costly startup or administrative fees.
SEPs operate like conventional IRAs, where you contribute pre-tax dollars and money withdrawn is subject to income tax.
Eligibility: Any employer, including the self-employed can open a SEP.
Contribution Limits: Contribution limits for employees in a SEP IRA are capped at the lower of:
- 25% of compensation, or
- $70,000 for 2025
For self-employed individuals, the contribution you can make is based on a special calculation.
Solo 401(k)
Plan Overview: Solo 401(k)s, commonly known as an Individual 401(k) or one-participant 401(k) plan, is a savings option for the self-employed designed for companies that have no employees or where the only employee is a spouse. Solo 401(k)s operate much like employer-sponsored 401(k) plans, and let you make contributions as both an employer and an employee with pre-tax money. This provides more savings versus SEPs or IRAs; however, the additional opportunities often come with more restricted investment choices. In a solo 401(k) plan, you can make either traditional or Roth deferrals, which have the same tax benefits as their IRA contribution counterparts.
Eligibility: Solo 401(k)s are available solely to business owners and their spouses may establish and contribute to a solo 401(k).
Contribution Limits: For self-employed individuals with a solo 401(k) plan, you have the ability to make two types of contributions:
- Employee contributions of up to 100% of your earned income from self-employment, capped at the annual contribution limit. In 2025, those limits are $23,500, or $31,000 if you are 50 or older, or $34,750 for individuals aged 60-63 in 2025.
- Contributions as an employer (as an employer) cannot exceed 25% of your adjusted self-employment income, which is defined as net profit minus half of your self-employment tax and the employee contributions you made.
The total contribution cannot exceed $70,000, or $77,500 for those aged 50 and older (as of 2025), $81,250 if you attain age 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: A defined benefit plan is a retirement option that delivers a set amount to business owners upon retirement. In contrast to the plans discussed earlier, a defined benefit plan doesn't fluctuate based on investment returns, but lets individuals clearly understand what they'll receive in retirement. This option is ideal for higher-income professionals who want to save a significant sum for retirement and are willing to make substantial contributions. Contributions grow tax-free until withdrawal, and withdrawals incur taxes as income during retirement.
Eligibility: Any self-employed individual managing a one-person company or employing fewer than five people can open an individual defined benefit plan, but it's most commonly recommended for people above age 50 who make $250,000 or more annually. Generally, good candidates for defined benefit plans tend to be:
- Entrepreneurs who desire to contribute more than $70,000 (or $77,500 if over age 50)
- Businesses currently investing 3-4% but are open to increasing contributions
- Businesses with proven consistent profit patterns
- Entrepreneurs over age 40 who wish to accelerate savings or accelerate the retirement savings
Contribution Limits: The maximum allowable contribution must be determined by an actuary determined by your financial situation, age, and savings targets. Contribution limits are updated yearly.
The Importance of a Financial Advisor in Anchorage, AK for Your Self-Employed Retirement Plan
Working with a financial advisor in Anchorage, AK experienced with retirement plans for the self-employed can be an essential partner for those working for themselves. They bring the skills needed to guide you through the challenges of retirement planning and develop a customized plan that aligns with your goals. Your advisor in Anchorage, AK will review your finances, identify your risk preferences, and guide you in making informed decisions about saving and investing for retirement. Part of what we do for you involves:
- Guide you in choosing a plan that best fits your needs and goals
- Further adapt the plan to your needs even further
- Create a written plan that complies with IRS regulations
- Organize a trust plan to manage your assets
- Help you understand the plan's terms
- Monitor and adjust your plan when necessary
- Offer continued financial education and guidance throughout your retirement planning process
- Increase your retirement income by maximizing your social security benefits
Self-Employed Retirement Plans in Anchorage, AK: Correct Capital's Process
Self-employed individuals in Anchorage, AK who lack the time, interest, or knowledge to oversee their self-employed retirement plan themselves may end up overwhelmed when faced with their available plans. Through our team at Correct Capital, our Anchorage, AK financial advisors handle the lion's share of your savings plan setup for you, to help make meeting your retirement goals as easy as possible for you. We are here to assist you in setting up your self-employed retirement plan in just four steps:
- Schedule a Call: In just 20 minutes, a member of our advisor team can help understand if we're a good fit for you and your business. This short conversation helps us learn about your needs with no obligation or major time investment on your part.
- Gather Information: If we both decide to move forward, we'll ask for information, including whether you have employees, your present financial standing, and your retirement goals. This helps us create a personalized strategy designed just for you.
- Review Your Plan: When we finalize a plan using the information you provide, we'll meet with you and discuss your plan thoroughly to make sure it's clear and understand how it best correlates to your needs.
- Implementation and Monitoring: After we agree on your plan, we'll set everything up so you can initiate your savings journey. As time goes on, we'll meet with you and track your progress to make sure it remains aligned with your goals.
Our Anchorage, AK financial advisors and retirement plan consultants serve as fiduciary advisors, which means they are committed by law and ethics to prioritize your needs above all else.
Other financial advisory services we offer in Anchorage, AK include:
- Financial Planning for Business Owners
- Comprehensive Financial Planning
- Retirement Income Planning
- Investment Planning
- Retirement Financial Planning
- Independent Financial Advisor
- Roth Conversion
- Investment Management
- 401(k) Audit
- High-Net-Worth Wealth Management
Call Correct Capital for Your Self-Employed Retirement Plan in Anchorage, AK
To you, your business is more than "just a business", and your Anchorage, AK financial advisors need to offer more than simply sound financial advice. Correct Capital takes pride in, we take the time to get to know our clients and their businesses to deliver personalized self-employed retirement plans. We offer all our Anchorage, AK clients our I.O.U. promise: all guidance we provide will be independent, objective, and unbiased. To take the first step on your self-employment retirement plan, reach out to Correct Capital at 877-930-401k or contact us online.
