Self-employed retirement plans Buffalo, NY. The independence of running your own company in Buffalo, NY is one of the greatest advantages of having a self-directed career. However, this freedom sometimes brings with certain challenges, especially regarding planning for retirement, since you don't have access to employer-sponsored retirement plans. Only 13% of self-employed individuals have a workplace retirement plan, but many would be better off looking into other possibilities. In addition to enjoying a more secure retirement, working with a financial advisor in Buffalo, NY to set up your self-employed retirement plan delivers significant tax advantages that allow both you and your business to thrive.
Few Buffalo, NY financial advisory and retirement planning firms understand the needs of small business owners better than Correct Capital. The father of our founder was a small business owner himself (learn more about our story here), and Correct Capital take pride in assisting business owners in their retirement planning needs. We recognize that your professional and personal aspirations aren’t limited to simple financial figures, and we strive to create customized solutions aligned with your vision. Read on to discover about your self-employed retirement plan options in Buffalo, NY, or call Correct Capital at 877-930-401k or contact us online to talk to a small business financial advisor in Buffalo, NY today.
Schedule a Meeting With an Advisor Today
Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.
Schedule a 15-Minute Introductory Call
Why Buffalo, NY Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals are essential for preparing you for the future, they also offer real benefits today. With customizable contribution options to significant tax savings, working with a financial advisor in Buffalo, NY enables you to create your retirement plan to suit your individual circumstances.
Flexibility That Fits Your Income
For those with fluctuating income over time, a plan like a SEP IRA or Solo 401(k) offers the freedom to tailor how much you save:
- Customizable Contributions: Contribute more during profitable years and scale back when revenues are down, ensuring your plan fits your cash flow.
- Roth Options: Choosing a Roth Solo 401(k) lets you pay taxes on contributions now, allowing you to withdraw your savings tax-free down the road—an advantageous choice if you expect your tax rate will increase in the future.
Save Money on Taxes
Plans designed for the self-employed deliver powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a Solo 401(k) reduce what you owe in taxes, so you can keep more of your earnings.
- Tax-Deferred Growth: You won't pay taxes on investment growth until you withdraw it, giving your money more time to accumulate.
- State-Specific Incentives: Based on your location, you could qualify for additional credits as a sole proprietor. These local incentives help make these plans even more beneficial.
- Retirement Savings Contributions Credit (Saver’s Credit): Eligible individuals can take advantage of a credit of up to 50% of the first $2,000 contributed a retirement plan, helping to lower your tax bill even more.
Protect Your Savings With Smart Investments
Creating a stable future isn’t only about how much you save—it’s also about how you invest:
- Diversified Portfolios: Distributing your investments across varied stocks, bonds, and other assets is a smart way to reduce risk while still growing your retirement fund.
- Emergency Back-Up: Pairing your retirement plan with a dedicated business safety net prevents you from dipping into savings during tough times and facing tax penalties.
Plan for the Future of Your Buffalo, NY Business
Preparing for retirement can assist you think through what’s next with your Buffalo, NY business:
- Selling Your Business: If you’re planning to sell, plans like SEP IRAs or Solo 401(k)s stay in your name and don’t transfer with the business. These plans can provide the steady income you’ll need in the future. Keep in mind that while selling a business often leads to a capital gain, deposits into these plans are subject to yearly maximums (e.g., up to $7,000 for IRAs or up to $70,000 for Solo 401(k)s, with catch-up contributions, according to plan rules).
- Minimizing Taxes: Strategically planning your contributions can reduce the taxes you are required to pay when you transfer your business.
- Succession Planning: Whether you’re transferring ownership, your retirement savings ensure financial security through the transition. You might want to work with a financial advisor with expertise in succession and retirement planning to reduce taxes associated with the transaction.
With the proper savings strategy, you manage your financial future, cut down your tax obligations, and establish a secure foundation for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Buffalo, NY Now?
Time is one of the most important resources when it comes to saving for retirement. Getting a head start not only lets you accumulate a larger nest egg but also minimizes the financial burden of catching up later in life. The following are reasons why it makes sense to begin today:
The Cost of Waiting
Waiting to start your retirement fund can have a substantial impact on the savings you’ll have when you retire. The primary reason is compound interest—the powerful process where your investments earn returns, and those returns, then, generate even more returns. The more time your money has to grow, the more significant the effect of this compounding process.
Example: Taylor and Alex are both self-employed professionals. Their shared goal is to save $500,000 for retirement by age 65:
- Alex starts saving $5,000 annually at age 30.
- Taylor waits until age 40 but saves $7,500 annually to catch up.
By age 65, assuming 7% annual return:
- Alex invests $180,000 and accumulates $691,184.39*.
- Taylor invests $195,500 but accumulates just $474,367.78*.
How Early Contributions Grow
Regular, modest investments invested steadily may result in significant growth. Consider this example showing the power of compound interest:
- Starting at age 25: Putting aside $200 per month in a retirement plan with an expected yearly growth rate of 7%, you’ll accumulate $497,303.29* by age 65.
- Starting at age 35: Contributing the same $200 per month leaves you with only $235,412.97* by age 65—a difference of over $260,000, all because of a 10-year delay.
The earlier you begin, the less you need to save each year to achieve your retirement goals.
*The figures provided in this example are based on estimates generated with NerdWallet’s Compound Interest Calculator, with the assumption of a 7% annual return. The contributions were calculated by multiplying the annual deposit amount by the total number of years contributions were made. These examples are for illustrative purposes only and cannot predict actual future outcomes. Your individual results may differ based on variables including market conditions, fees, and your unique situation. We recommend consulting a financial advisor for personalized advice.
Take Control of Your Financial Future
If you’re self-employed in Buffalo, NY, it might seem easier to put more emphasis on reinvesting in your business instead of saving for retirement. Even so, beginning a plan now enables you to:
- Leverage tax-free future growth or penalty-free withdrawals down the road.
- Enjoy flexible contributions that adapt to your income.
- Create a safety net that ensures stability, no matter how your business develops.
Starting early, the less you’ll be required to worry about making up for lost time later in life. Building your retirement savings today means taking control of your financial future and allowing yourself the ability to turn your attention to your goals—both for your golden years and your Buffalo, NY business.
Types of Self-Employed Retirement Plans
There are several retirement savings options available for self-employed individuals in Buffalo, NY, each with its own benefits and trade-offs. A financial advisor can help you learn about the pros and cons of each option and choose the one best suited for your circumstances. In most cases, your self-employed retirement plan options in Buffalo, NY include:
Traditional or Roth IRA
Plan Overview: IRAs, or Individual Retirement Accounts, are long-term savings plans that include key tax perks. In a conventional IRA, you can usually deduct your contributions from taxable income, and investment earnings grow tax-deferred, but money taken out during retirement are taxable. In contrast, with Roth IRAs, you contribute from post-tax earnings, but retirement withdrawals that qualify, including earnings, are tax-free. In both accounts, withdrawals come without penalties if you are at least 59½.
Eligibility: Unlike 401(k)s, which are employer-sponsored, both traditional and Roth IRAs are available to anyone with taxable earnings.
Contribution Limits: For 2025, annual contribution limits for IRAs are capped at $7,000, or $8,000 if you're 50 or older.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: SEP IRAs offers a way to save for retirement that permits those who are self-employed to contribute a percentage of their net earnings. Contributions can only be made by an employer, so, as a sole proprietor, you (the employee) cannot make additional contributions above the 25% you (the employer) already contributed. If you have employees, you are obligated to contribute the same amount for them as you do for yourself. It's your choice whether to contribute a set monetary value or a percentage of wages to employee accounts. A SEP IRA works well for entrepreneurs facing periods of inconsistent earnings. Compared to other retirement options, SEP IRAs don’t have costly startup or administrative fees.
SEPs function like standard IRAs, where the contributions are tax-deferred and money withdrawn is subject to income tax.
Eligibility: Both employers and self-employed individuals can set up a SEP.
Contribution Limits: Contribution limits for employees in a SEP IRA are the lesser 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, also called an Individual 401(k) or one-participant 401(k) plan, is a retirement savings plan meant for businesses without employees or when the sole employee is your spouse. This type of plan operate much like standard 401(k) plans, and allow you to contribute as both an employee or an employer with pre-tax money. This allows for more savings versus SEPs or IRAs; however, the increased savings potential often come with more limited investment options. In a solo 401(k) plan, you can make either traditional or Roth deferrals, which offer the same tax benefits as their IRA contribution counterparts.
Eligibility: This plan is exclusively for business owners and their spouses are eligible to open and contribute to a solo 401(k).
Contribution Limits: For self-employed individuals with a solo 401(k) plan, you can make two types of contributions:
- Elective deferrals (as an employee) of up to 100% of your earned income from self-employment, capped at the annual contribution limit. The contribution limits for 2025 include $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) must not surpass 25% of your net self-employment income, which is your net profit minus half of your self-employment tax and the elective deferrals you made.
Total contributions are capped at $70,000, or $77,500 if you're over age 50 (as of 2025), $81,250 if you attain age 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: Defined benefit plans is a retirement option that delivers a set amount to self-employed individuals upon retirement. Unlike defined contribution plans mentioned above, investment returns don’t affect the payout, but allows self-employed individuals to know the precise amount they'll get in retirement. This plan is ideal for wealthier entrepreneurs who want to save a significant sum for retirement and can commit to making substantial contributions. Contributions grow tax-free until withdrawal, and withdrawals are taxed as income upon retirement.
Eligibility: Any self-employed individual running an owner-only business or with a small staff of under five can open an individual defined benefit plan, but it's generally advised for people above age 50 who make $250,000 or more annually. In most cases, good candidates for defined benefit plans tend to be:
- Entrepreneurs who aim to deposit more than $70,000 (or $77,500 if over age 50)
- Organizations that already put in 3-4% but are open to increasing contributions
- Companies showing consistent profit patterns
- Partners or owners over age 40 who wish to accelerate savings or boost savings within a short timeframe
Contribution Limits: The contribution limit must be determined by an actuary using your income, age, and retirement goals. Limits on contributions change annually.
The Importance of a Financial Advisor in Buffalo, NY for Your Self-Employed Retirement Plan
Working with a financial advisor in Buffalo, NY specialized in self-employed retirement plans can be an invaluable resource for self-employed individuals. They have the expertise to help navigate the complexities of retirement planning and design a customized plan that aligns with your goals. An expert in your area will review your finances, determine how much risk you’re comfortable with, and assist you in selecting the best options about saving and investing for retirement. Included in what we do for you features:
- Guide you in choosing a plan that best fits your needs and goals
- Further adapt the plan to your needs even further
- Formalize a plan in writing as required by IRS rules
- Arrange a trust plan for assets
- Make sure you understand the plan's terms
- Monitor and adjust your plan to keep it aligned with your goals
- 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 Buffalo, NY: Correct Capital's Process
Self-employed individuals in Buffalo, NY who lack the time, interest, or knowledge to manage their self-employed retirement plan independently can become overwhelmed by their options. At Correct Capital, our Buffalo, NY financial advisors handle the bulk of your retirement planning for you, and strive to ensure meeting your financial objectives as straightforward as possible for you. We can help you get set up your self-employed retirement plan in four simple steps:
- Schedule a Call: In just 20 minutes, a member of our advisor team can help understand if our services align for you and your business. This initial call lets us learn about your needs with no obligation or major time investment on your part.
- Gather Information: Once we mutually decide to continue, we'll ask for information, including your employee count, your existing financial picture, and your long-term savings targets. This helps us create a tailored approach designed just for you.
- Review Your Plan: When we finalize a plan based on the information you provide, we'll sit down with you and discuss your plan step by step to help you fully grasp it and explain its fit to your circumstances.
- Implementation and Monitoring: Once we've agreed on your plan, we'll put everything in place so you can begin contributing. Throughout our relationship, we'll meet with you and review your strategy to keep it tailored to your evolving circumstances.
Our Buffalo, NY financial advisors and retirement plan consultants act as fiduciary advisors, meaning they are required by law and ethical standards to act in your best interest.
Other financial advisory services we offer in Buffalo, NY include:
- 401(k) Audit
- High-Net-Worth Wealth Management
- Retirement Planner
- Financial Planning
- Retirement Plan Consultants
- Fiduciary Financial Advisor
Call Correct Capital for Your Self-Employed Retirement Plan in Buffalo, NY
Your business isn't "just a business" to you, and your Buffalo, NY financial advisors must deliver more than just good financial guidance. At Correct Capital, we take the time to get to know our clients and their businesses to provide customized self-employed retirement plans. We offer all our Buffalo, NY 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, contact Correct Capital now at 877-930-401k or contact us online.
