Self-employed retirement plans Columbus, GA. The freedom of running your own company in Columbus, GA is one of the best aspects of having a self-directed career. However, this freedom often comes with certain challenges, particularly in terms of building your retirement fund, because you don't have access to retirement programs through an employer. Only 13% of self-employed individuals have a workplace retirement plan, but many would be better off understanding their retirement options. In addition to having a more comfortable retirement, working with a financial advisor in Columbus, GA to establish your self-employed retirement plan can provide significant tax advantages that allow both you and your business to thrive.
Few Columbus, GA financial advisory and retirement planning firms are as attuned to the requirements of small business owners better than Correct Capital. Our company’s founder grew up with a father who was a small business owner himself (read more of our story here), and Correct Capital take pride in supporting entrepreneurs with their retirement planning needs. We recognize that your professional and personal aspirations extend well past basic numbers, and we work tirelessly to create customized solutions that reflect your objectives. Keep reading to learn more about your self-employed retirement plan options in Columbus, GA, or give us a call at Correct Capital at 877-930-401k or contact us online to consult with a small business financial advisor in Columbus, GA today.
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Why Columbus, GA 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. Offering flexibility in contributions to significant tax savings, consulting a financial advisor in Columbus, GA helps you customize your retirement plan to fit your unique financial situation.
Flexibility That Fits Your Income
When your earnings vary over time, a plan like a SEP IRA or Solo 401(k) offers the flexibility to adjust how much you save:
- Customizable Contributions: Set aside more during high-income years and cut back when income is lower, so that your plan fits your financial situation.
- Roth Options: A Roth Solo 401(k) lets you pay taxes on contributions now, enabling you to withdraw without tax penalties in the future—a wise move if you believe your tax rate will increase in the future.
Save Money on Taxes
Retirement plans for self-employed individuals provide significant tax benefits:
- Tax-Deductible Contributions: Contributions to a Solo 401(k) reduce what you owe in taxes, so you can keep more of your hard-earned money.
- Tax-Deferred Growth: You won't pay taxes on investment growth until you withdraw it, giving your money more time to grow.
- State-Specific Incentives: In some states, you could qualify for state-specific deductions as a business owner. These regional incentives help make these plans even more beneficial.
- Retirement Savings Contributions Credit (Saver’s Credit): Eligible individuals can claim a tax credit of up to 50% of the first $2,000 put into a retirement plan, helping to lower your tax bill even more.
Protect Your Savings With Smart Investments
Building a secure retirement goes beyond just how much you save—it’s also about how you invest:
- Diversified Portfolios: Spreading your investments across varied stocks, bonds, and alternatives can help minimize exposure to risk while helping to grow your nest egg.
- Emergency Back-Up: Supplementing your retirement savings with a financial buffer for your business helps you avoid dipping into savings during financial hardships and facing tax penalties.
Plan for the Future of Your Columbus, GA Business
A thoughtful retirement strategy can assist you plan ahead for what’s next with your Columbus, GA 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 ensure the financial stability you’ll need later on. It’s important to note that while the sale of a business usually creates a capital gain, contributions to retirement accounts are restricted by contribution limits (e.g., a maximum of $7,000 for IRAs or a maximum of $70,000 for Solo 401(k)s, with catch-up contributions, depending on plan details).
- Minimizing Taxes: Using retirement contributions wisely can reduce the taxes you’ll owe when you sell your business.
- Succession Planning: If you’re passing the business on, your retirement accounts provide financial security through the transition. You might want to seek advice from a financial advisor who specializes in succession planning and retirement accounts to reduce taxes associated with the transaction.
With the proper savings strategy, you can take control of your financial future, reduce your tax burden, and create a strong framework for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Columbus, GA Now?
There’s no denying that time is one of the most important factors for building your retirement fund. Beginning sooner rather than later not only helps you grow a larger nest egg but also reduces the pressure of catching up later in life. The following are reasons why it is beneficial to start now:
The Cost of Waiting
Delaying your retirement savings can have a major impact on the total you’ll have when you reach retirement age. The primary reason is compound interest—the powerful process where your investments grow, and those returns, subsequently, earn even more returns. The greater time span your money has to grow, the larger the impact of compounding.
Example: Two individuals, Alex and Taylor are both entrepreneurs. They each aim to save $500,000 for retirement by age 65:
- Alex initiates savings of $5,000 annually at age 30.
- Taylor delays savings until age 40 but saves $7,500 annually to bridge the gap.
By age 65, using a projected 7% annual return:
- Alex contributes $180,000 and accumulates $691,184.39*.
- Taylor puts in $195,500 but accumulates just $474,367.78*.
How Early Contributions Grow
Even modest contributions invested steadily may result in substantial growth. Take a look at this scenario showing the effect of compounding:
- Starting at age 25: If you invest $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 would result in only $235,412.97* by age 65—a gap of over $260,000, all because of a 10-year delay.
Saving early, the less you need to save each year to achieve your retirement goals.
*The numbers shown in this scenario are estimates calculated using NerdWallet’s Compound Interest Calculator, assuming a 7% annual return. These calculations involved multiplying yearly deposits by the years contributed. This information is intended as illustrative examples and cannot predict actual future outcomes. Outcomes may change depending on factors such as market conditions, fees, and your unique situation. Be sure to speak with a financial advisor for personalized advice.
Take Control of Your Financial Future
For self-employed individuals in Columbus, GA, it is often the case that you put more emphasis on reinvesting in your business instead of saving for retirement. That said, beginning a plan now gives you the chance to:
- Benefit from growth that is tax-deferred or tax-free withdrawals down the road.
- Take advantage of adjustable savings that align with your earnings.
- Build a financial cushion that provides security, no matter how your business changes.
The sooner you start, the less you’ll have to worry about catching up later in life. Building your retirement savings today means managing your financial future and giving yourself the ability to turn your attention to your dreams—both for your golden years and your Columbus, GA business.
Types of Self-Employed Retirement Plans
Multiple retirement savings options open for entrepreneurs in Columbus, GA, each providing its own benefits and trade-offs. A financial advisor will guide you to learn about the benefits and drawbacks of each choice and determine the one most suitable for your needs. Generally speaking, your self-employed retirement plan options in Columbus, GA are:
Traditional or Roth IRA
Plan Overview: IRAs, or Individual Retirement Accounts, are financial tools for retirement that provide specific tax advantages. In a traditional IRA, you can usually deduct your contributions from taxable income, and returns grow free of current taxes, but withdrawals in retirement are taxed as income. In contrast, with Roth IRAs, you contribute from post-tax earnings, but eligible distributions during retirement, including earnings, are tax-free. In both types of accounts, withdrawals are penalty-free if 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 accessible for individuals with taxable earnings.
Contribution Limits: For 2025, annual contribution limits for IRAs are capped at $7,000, or $8,000 if you qualify for catch-up contributions.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: The Simplified Employee Pension IRA serves as a retirement savings option that enables those who are self-employed to set aside a portion of their self-employment income. Contributions can only be made by an employer, so, as a self-employed individual, you (the employee) would not be able to contribute more than the 25% you (the employer) allocate. If you have employees, it's required to contribute the same amount for them as you do for yourself. It's your choice whether to contribute a flat-dollar amount or a percentage of wages to employee accounts. This type of plan works well for entrepreneurs facing periods of inconsistent earnings. In contrast to some alternatives, SEP IRAs don’t have expensive setup or ongoing fees.
SEPs work like standard IRAs, where contributions are made with pre-tax money and retirement distributions are taxable.
Eligibility: Any employer, including the self-employed can establish 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
As a self-employed person, the amount eligible to be contributed 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 savings option for the self-employed meant for businesses with no employees or where the only employee is a spouse. These plans operate much like standard 401(k) plans, and let you make contributions as both an employee or an employer with pre-tax money. This provides more savings compared to SEPs or IRAs; however, the increased savings potential may be offset by more restricted investment choices. Using a solo 401(k), you can make either traditional or Roth deferrals, which have the same tax benefits as their IRA contribution counterparts.
Eligibility: Only business owners and their spouses can set up and contribute to a solo 401(k).
Contribution Limits: If you are self-employed with a solo 401(k) plan, you have the ability to make two types of contributions:
- Deferrals as an employee of up to 100% of your self-employment income, subject to 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 adjusted self-employment income, which is calculated as net profits less 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 for those aged 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: The defined benefit plan represents a type of retirement plan that guarantees a set amount to business owners upon retirement. As opposed to defined contribution plans, investment returns don’t affect the payout, but lets individuals clearly understand what they'll have in retirement. This option is recommended for wealthier professionals who want to save a significant sum for retirement and can commit to making sizeable contributions. Contributions offer tax-deferred growth, and withdrawals are taxed as income upon retirement.
Eligibility: Entrepreneurs managing a one-person company or with a small staff of under five may establish an individual defined benefit plan, but it's most commonly suggested for those over 50 who generate a minimum of $250,000 yearly. In most cases, good candidates for defined benefit plans include:
- Partners or owners who want to invest more than $70,000 (or $77,500 for those aged 50+)
- Businesses currently investing 3-4% with plans to contribute more
- 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 cap on contributions must be determined by an actuary determined by your income, age, and retirement goals. Allowable contributions change annually.
The Importance of a Financial Advisor in Columbus, GA for Your Self-Employed Retirement Plan
A financial advisor in Columbus, GA specialized in self-employed retirement plans can be an essential partner for self-employed individuals. They offer the knowledge to assist navigate the complexities of retirement planning and craft a personalized approach that reflects your aspirations. A financial advisor in Columbus, GA will evaluate your financial situation, determine how much risk you’re comfortable with, and assist you in choosing wisely about saving and investing for retirement. Part of what we do for you involves:
- Help you choose a plan that aligns with your objectives and circumstances
- Tailor the plan to your needs even further
- Adopt a written plan in accordance with IRS guidelines
- Arrange a trust plan for assets
- Make sure you understand the plan's terms
- Review and modify your plan when necessary
- Provide ongoing education and advice to help you navigate your retirement journey
- Increase your retirement income by maximizing your social security benefits
Self-Employed Retirement Plans in Columbus, GA: Correct Capital's Process
Self-employed individuals in Columbus, GA who don’t have the time or expertise to oversee their self-employed retirement plan on their own may end up overwhelmed by their choices. With Correct Capital, our Columbus, GA financial advisors handle the majority of your retirement planning for you, working to make meeting your financial objectives 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: A quick 20-minute call is all it takes, a member of our advisor team can help understand if we're suited to your needs for you and your business. This brief introduction helps us get a sense of your goals with zero commitment or major time investment on your part.
- Gather Information: Should we agree to proceed, we'll request information, including your employee count, your present financial standing, and your future objectives. This allows us to put together a custom plan that aligns with your goals.
- Review Your Plan: After we put together a plan based on the information you provide, we'll meet with you and go over your plan in detail to ensure you understand it and explain its fit to your circumstances.
- Implementation and Monitoring: When we finalize on your plan, we'll implement the necessary steps so you can begin contributing. Throughout our relationship, we'll meet with you and monitor your plan to make sure it remains aligned with your goals.
Our Columbus, GA financial advisors and retirement plan consultants act 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 Columbus, GA 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 Columbus, GA
To you, your business is more than "just a business", and your Columbus, GA financial advisors must deliver more than basic financial recommendations. Correct Capital takes pride in, we make it a priority to understand our clients and their businesses to deliver personalized self-employed retirement plans. All our clients in Columbus, GA benefit from our I.O.U. promise: everything we recommend will be independent, objective, and unbiased. To get started on your self-employment retirement plan, contact Correct Capital now at 877-930-401k or contact us online.
