Self-employed retirement plans Glendale, AZ. The independence of owning your own business in Glendale, AZ is one of the greatest advantages of working for yourself. However, this independence can come with potential drawbacks, notably in terms of building your retirement fund, since you don't have the benefit of a workplace retirement plan. Only 13% of self-employed individuals have a workplace retirement plan, although many could benefit from looking into other possibilities. In addition to having a more secure retirement, working with a financial advisor in Glendale, AZ to establish your self-employed retirement plan delivers significant tax advantages that allow you to move your business forward.
Few Glendale, AZ investment consulting and retirement planning firms understand the needs of self-employed individuals as well as Correct Capital. Our founder's father was a small business owner himself (read more of our story here), and our firm have a rich history of helping businesses with their retirement planning needs. We recognize that your goals for your business and retirement extend well past simple financial figures, and we strive to offer personalized solutions that reflect your objectives. Continue exploring to find out about your self-employed retirement plan options in Glendale, AZ, or give us a call at Correct Capital at 877-930-401k or contact us online to talk to a entrepreneurial financial advisor in Glendale, AZ 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 Glendale, AZ Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals help prepare you for the future, they also provide immediate benefits today. From flexible contributions to substantial tax savings, partnering with a financial advisor in Glendale, AZ helps you customize your retirement plan to fit 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) offers the freedom to tailor how much you save:
- Customizable Contributions: Save extra during high-income years and reduce savings when revenues are down, so your plan fits your current income.
- Roth Options: Opting for a Roth Solo 401(k) lets you handle taxes upfront, enabling you to withdraw your savings tax-free down the road—an advantageous choice if you anticipate your tax rate is likely to rise in the future.
Save Money on Taxes
Retirement plans for self-employed individuals provide powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a SIMPLE IRA lower your taxable income, helping you keep more of your earnings.
- Tax-Deferred Growth: Investments grow tax-free until withdrawal, providing your money more time to accumulate.
- State-Specific Incentives: Depending on where you live, you might access additional tax breaks as a self-employed individual. These local incentives help make these plans even more valuable.
- Retirement Savings Contributions Credit (Saver’s Credit): Eligible individuals can apply for a credit of up to 50% of the first $2,000 put into a retirement plan, further reducing 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 determined by your investment strategy:
- Diversified Portfolios: Distributing your investments across a mix of asset classes like stocks and bonds is a smart way to minimize exposure to risk while still growing your nest egg.
- Emergency Back-Up: Combining your retirement strategy and a dedicated business safety net prevents you from dipping into savings during financial hardships and facing tax penalties.
Plan for the Future of Your Glendale, AZ Business
A thoughtful retirement strategy enables you to prepare for what’s next with your Glendale, AZ business:
- Selling Your Business: For those considering a sale, retirement accounts like SEP IRAs and Solo 401(k)s remain your personal assets and won’t be included in the sale. These savings can provide the steady income you’ll need later on. It’s important to note that while selling your business results in a capital gain, contributions to retirement accounts are subject to yearly maximums (e.g., up to $7,000 for IRAs or as much as $70,000 for Solo 401(k)s, factoring in 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: If you’re passing the business on, your retirement savings provide financial security through the transition. You may also partner with a financial advisor with expertise in succession and retirement planning to help with taxes associated with the transaction.
With the best-fit retirement strategy, you gain control over your financial future, reduce your tax burden, and build a solid base for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Glendale, AZ Now?
There’s no denying that time is one of the most valuable resources when it comes to saving for retirement. Getting a head start not only allows you to build a bigger financial cushion but also lowers the pressure of catching up later in life. The following are reasons why it is beneficial to start now:
The Cost of Waiting
Waiting to start your retirement fund may cause a significant impact on the total you’ll have when you stop working. The primary reason is compound interest—the concept where your investments grow, and those returns, in turn, earn even more returns. The longer your money has to grow, the more significant the benefit of compounding.
Example: Two individuals, Alex and Taylor are both self-employed individuals. 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 puts away $7,500 annually to catch up.
By age 65, assuming 7% annual return:
- Alex puts in $180,000 and achieves a total of $691,184.39*.
- Taylor contributes $195,500 but accumulates just $474,367.78*.
How Early Contributions Grow
Small, consistent savings made consistently often create significant growth. Consider this example showing the power of compound interest:
- 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: Investing the same $200 per month yields only $235,412.97* by age 65—a shortfall of over $260,000, all because of a 10-year delay.
The earlier you begin, the less effort required each year to achieve your retirement goals.
*These calculations represent estimates derived from NerdWallet’s Compound Interest Calculator, assuming a 7% annual return. Annual deposits were multiplied by the number of years to estimate total contributions. These examples are for illustrative purposes only and are not a promise of future results. Actual results may vary depending on variables including market conditions, fees, and your unique situation. Be sure to speak with a financial advisor for personalized advice.
Take Control of Your Financial Future
If you’re self-employed in Glendale, AZ, it is often the case that you focus more on reinvesting in your business over saving for retirement. However, initiating a plan now gives you the chance to:
- Leverage tax-deferred growth or penalty-free withdrawals later on.
- Enjoy adjustable savings that change with your cash flow.
- Build a long-term safety measure that provides security, no matter how your business changes.
Starting early, the less you’ll have to worry about playing catch-up later in life. Taking steps toward your retirement goals today means gaining control over your financial future and giving yourself the opportunity to focus on your dreams—both for your retirement years and your Glendale, AZ business.
Types of Self-Employed Retirement Plans
A variety of retirement savings options designed for self-employed individuals in Glendale, AZ, each with its own advantages and considerations. A financial advisor will guide you to understand the benefits and drawbacks of each option and determine the one best suited for your unique situation. In most cases, your self-employed retirement plan options in Glendale, AZ include:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent retirement savings vehicles that offer distinct tax benefits. In a standard IRA, contributions are typically tax-deductible, and returns grow free of current taxes, but money taken out during retirement are taxable. In contrast, Roth IRA contributions are made with after-tax income, but retirement withdrawals that qualify, including earnings, are tax-free. In both 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 an earned income.
Contribution Limits: For 2025, annual contribution limits for IRAs remain $7,000, or $8,000 for those aged 50+.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: The Simplified Employee Pension IRA offers a way to save for retirement that allows entrepreneurs to set aside a portion of their self-employment income. Contributions must come from an employer, so, as a sole proprietor, you (the employee) would not be able to contribute beyond the 25% you (the employer) allocate. If you have employees, you must contribute the same amount for them as you do for yourself. You have the flexibility to contribute a fixed dollar figure or a percentage of wages to employee accounts. SEP IRAs is a good option for businesses that experience periods of inconsistent earnings. Compared to other retirement options, SEP IRAs lack costly startup or administrative fees.
SEPs function 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 the lesser of:
- 25% of compensation, or
- $70,000 for 2025
For self-employed individuals, the amount eligible to be contributed 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 intended for businesses without employees or if the only employee is your spouse. Solo 401(k)s function similarly to standard 401(k) plans, and let you make contributions as both an employee or an employer with pre-tax money. This offers more savings versus SEPs or IRAs; however, the additional opportunities can be balanced by more restricted investment choices. With this type of 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 may establish and contribute to a solo 401(k).
Contribution Limits: As a self-employed individual with a solo 401(k) plan, you are allowed to make two types of contributions:
- Deferrals as an employee of up to 100% of your self-employed earnings, 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 if you attain age 60-63 in 2025.
- Contributions as an employer (as an employer) are limited to 25% of your net earnings from self-employment, which is your net profit minus half of your self-employment tax and the deferrals you made.
Your combined contributions must not surpass $70,000, or $77,500 for those aged 50 and older (in 2025), $81,250 for individuals turning 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: The defined benefit plan offers a structured retirement solution that guarantees a fixed, predetermined benefit to self-employed individuals upon retirement. As opposed to defined contribution plans, investment returns don’t affect the payout, but enables participants to determine what they'll get in retirement. This option is ideal for higher-income self-employed individuals who aim to accumulate a substantial amount for retirement and are prepared to contribute larger deposits. Contributions are tax deferred, and withdrawals are taxed as income upon retirement.
Eligibility: Entrepreneurs operating a solo business or with less than five employees may establish an individual defined benefit plan, but it's most commonly advised for individuals aged 50+ who make $250,000 or more annually. Generally, good candidates for defined benefit plans include:
- Partners or owners who want to invest more than $70,000 (or $77,500 for individuals 50 and older)
- Businesses currently investing 3-4% but are open to increasing contributions
- Businesses with proven consistent profit patterns
- Business leaders over age 40 who wish to accelerate savings or boost savings within a short timeframe
Contribution Limits: The maximum allowable contribution is calculated by an actuary using your financial situation, age, and savings targets. Allowable contributions are updated yearly.
The Importance of a Financial Advisor in Glendale, AZ for Your Self-Employed Retirement Plan
A financial advisor in Glendale, AZ focused on self-employed retirement strategies can be an important asset for self-employed individuals. They have the expertise to help navigate the complexities of retirement planning and craft a customized plan that aligns with your goals. A financial advisor in Glendale, AZ will review your finances, understand your risk tolerance, and guide you in making informed decisions about saving and investing for retirement. Part of what we do for you involves:
- Help you choose a plan that best fits your needs and goals
- Tailor the plan to your specific situation even further
- Formalize a plan in writing that complies with IRS regulations
- Set up an asset trust plan
- Ensure you comprehend the plan's terms
- Monitor and adjust your plan when necessary
- Offer continued financial education and guidance to help you navigate your retirement journey
- Maximize what you receive in retirement by maximizing your social security benefits
Self-Employed Retirement Plans in Glendale, AZ: Correct Capital's Process
Glendale, AZ business owners who aren’t equipped with the time or understanding to oversee their self-employed retirement plan themselves can become overwhelmed when faced with their options. Through our team at Correct Capital, our Glendale, AZ financial advisors take on the bulk of your retirement strategy for you, working to make meeting your financial objectives as straightforward 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 will assess if our services align for you and your business. This initial call helps us understand what you're looking for with no pressure or extensive time commitment on your part.
- Gather Information: Should we agree to proceed, we'll gather information, including whether you have employees, your existing financial picture, and your future objectives. This allows us to put together a custom plan suited specifically for your needs.
- Review Your Plan: When we finalize a plan using the information you provide, we'll schedule a meeting and go over your plan in detail to help you fully grasp it and explain its fit to your circumstances.
- Implementation and Monitoring: When we finalize on your plan, we'll put everything in place so you can begin contributing. Throughout our relationship, we'll have regular meetings and monitor your plan to make sure it remains aligned with your goals.
Our Glendale, AZ financial advisors and retirement plan consultants act as fiduciary advisors, who are obligated to they are legally and ethically bound to act in your best interest.
Other financial advisory services we offer in Glendale, AZ 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 Glendale, AZ
To you, your business is more than "just a business", and your Glendale, AZ financial advisors need to offer more than basic financial recommendations. At Correct Capital, we make it a priority to understand our clients and their businesses to create customized self-employed retirement plans. We offer all our Glendale, AZ clients 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.
