Self-employed retirement plans Lincoln, NE. The freedom of being your own boss in Lincoln, NE is one of the greatest advantages of working for yourself. However, this independence often comes with certain challenges, particularly in terms of retirement savings, because you don't have the option of employer-sponsored retirement plans. Only 13% of self-employed individuals have a workplace retirement plan, although many could benefit from exploring their options. In addition to enjoying a financially stable retirement, partnering with a financial advisor in Lincoln, NE to establish your self-employed retirement plan offers significant tax advantages that help both you and your business to thrive.
Few Lincoln, NE financial advisory and retirement planning firms understand the needs of small business owners as well as Correct Capital. Our founder's father was a small business owner himself (read more of our story here), and Correct Capital have a rich history of helping businesses with their retirement planning needs. We recognize that your goals for your business and retirement aren’t limited to simple financial figures, and we work tirelessly to offer personalized solutions that reflect your objectives. Keep reading to learn more about your self-employed retirement plan options in Lincoln, NE, or give us a call at Correct Capital at 877-930-401k or contact us online to talk to a self-employed financial advisor in Lincoln, NE today.
Why Lincoln, NE Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals help prepare you for the future, they also deliver immediate benefits today. With customizable contribution options to considerable tax savings, working with a financial advisor in Lincoln, NE enables you to create your retirement plan to suit your unique financial situation.
Flexibility That Fits Your Income
For those with fluctuating income annually, 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 profitable years and scale back when revenues are down, so your plan fits your current income.
- Roth Options: A Roth Solo 401(k) lets you settle taxes at the time of contribution, so you can withdraw your savings tax-free down the road—an advantageous choice if you believe your tax rate will increase in the future.
Save Money on Taxes
Self-employed retirement plans provide valuable tax benefits:
- Tax-Deductible Contributions: Contributions to a SIMPLE IRA lower your taxable income, 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 compound.
- State-Specific Incentives: Based on your location, you may be eligible for state-specific deductions as a business owner. These state-level incentives help make these plans even more valuable.
- Retirement Savings Contributions Credit (Saver’s Credit): Qualified participants can take advantage of a 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
Planning for a safe retirement goes beyond just how much you save—it’s also about how you invest:
- Diversified Portfolios: Allocating your investments across a mix of stocks, bonds, and alternatives serves to reduce risk while helping to grow your retirement fund.
- Emergency Back-Up: Combining your retirement strategy and a business emergency fund helps you avoid tapping into your nest egg during challenging periods and facing tax penalties.
Plan for the Future of Your Lincoln, NE Business
A thoughtful retirement strategy enables you to prepare for what’s next with your Lincoln, NE business:
- Selling Your Business: When selling your business, plans like SEP IRAs or Solo 401(k)s stay in your name and are not part of the sale. These plans can provide the steady income you’ll need in the future. 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., as much as $7,000 for IRAs or a maximum of $70,000 for Solo 401(k)s, including catch-up contributions, according to plan rules).
- Minimizing Taxes: Strategically planning your contributions minimizes the taxes you might face when you pass on your business.
- Succession Planning: For those winding down or handing over their business, your nest egg ensure the funds you need as you make this shift. You may also partner with a financial advisor who specializes in succession planning and retirement accounts to minimize tax burdens on the sale.
With the proper savings strategy, you can take control of your financial future, lower your tax bill, and establish a solid base for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Lincoln, NE Now?
There’s no denying that time is one of the most valuable factors in retirement planning. Starting early not only helps you grow a bigger financial cushion but also lowers the financial burden of playing catch-up as you get older. The following are reasons why it makes sense to begin today:
The Cost of Waiting
Putting off saving for retirement may cause a substantial impact on the amount you’ll have when you reach retirement age. The main reason is compound interest—the powerful process where your investments generate earnings, and those returns, in turn, accumulate even more returns. The longer your money has to grow, the greater the benefit of this growth.
Example: Two individuals, Alex and Taylor are both entrepreneurs. Both of them want to save $500,000 for retirement by age 65:
- Alex begins contributing $5,000 annually at age 30.
- Taylor postpones starting contributions to age 40 but saves $7,500 annually to bridge the gap.
By age 65, using a projected 7% annual return:
- Alex invests $180,000 and accumulates $691,184.39*.
- Taylor contributes $195,500 but accumulates just $474,367.78*.
How Early Contributions Grow
Regular, modest investments made consistently often create significant growth. Consider this example showing the effect of consistent growth:
- 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 leaves you with only $235,412.97* by age 65—a difference of over $260,000, all because of a 10-year delay.
Starting sooner, the less you need to save each year to reach your retirement goals.
*The figures provided in this example are estimates generated with NerdWallet’s Compound Interest Calculator, with the assumption of a 7% annual return. Annual deposits were multiplied by the number of years to estimate total contributions. This information is for illustrative purposes only and are not a promise of future results. Outcomes may change based on variables including market conditions, fees, and personal factors. We recommend consulting a financial advisor for guidance tailored to your needs.
Take Control of Your Financial Future
As a self-employed person in Lincoln, NE, it might seem easier to put more emphasis on reinvesting in your business rather than saving for retirement. That said, starting a plan now enables you to:
- Benefit from tax-deferred growth or tax-free withdrawals in the future.
- Enjoy flexible contributions that change with your earnings.
- Build a safety net that offers peace of mind, no matter how your business changes.
Getting started now, the less you’ll have to worry about catching up later in life. Taking steps toward your retirement goals today means managing your financial future and giving yourself the freedom to turn your attention to your goals—both for your golden years and your Lincoln, NE business.
Types of Self-Employed Retirement Plans
There are several retirement savings options open for entrepreneurs in Lincoln, NE, each providing its own benefits and trade-offs. A financial advisor is available to help you learn about the advantages and disadvantages of each plan and choose the one most suitable for your circumstances. In most cases, your self-employed retirement plan options in Lincoln, NE include:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent retirement savings vehicles that include specific tax advantages. In a standard IRA, contributions are typically tax-deductible, and investment earnings grow tax-deferred, but money taken out during retirement are subject to income tax. In contrast, Roth IRA contributions from post-tax earnings, but qualified withdrawals in retirement, including earnings, are tax-free. In both accounts, withdrawals don’t incur penalties provided you are at least 59½.
Eligibility: Unlike plans linked to your job, IRAs, including traditional and Roth options are open to those with an earned income.
Contribution Limits: For 2025, annual contribution limits for IRAs remain $7,000, or $8,000 if you're 50 or older.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: A Simplified Employee Pension (SEP) IRA serves as a retirement savings option that permits those who are self-employed to contribute a percentage of their net earnings. 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, you are obligated to contribute the same amount for them as you do for yourself. You have the flexibility to contribute a set monetary value or a percentage of wages to employee accounts. SEP IRAs is a good option for companies with fluctuating revenue streams. Compared to other retirement options, SEP IRAs don’t have expensive setup or ongoing fees.
SEPs operate like conventional IRAs, where the contributions are tax-deferred 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
For self-employed individuals, the allowable contribution is based on a special calculation.
Solo 401(k)
Plan Overview: A Solo 401(k) plan, commonly known as an Individual 401(k) or one-participant 401(k) plan, is a retirement savings plan meant for companies that have no employees or when the sole employee is your spouse. These plans function similarly to standard 401(k) plans, and let you make contributions as both the employer and the employee with pre-tax money. This allows for more savings versus SEPs or IRAs; however, the additional opportunities often come with 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: Only business owners and their spouses are eligible to open and contribute to a solo 401(k).
Contribution Limits: If you are self-employed with a solo 401(k) plan, you are allowed to 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. In 2025, those limits are $23,500, or $31,000 for those aged 50 and above, or $34,750 for those who turn 60-63 in 2025.
- Contributions as an employer (as an employer) are limited to 25% of your net earnings from self-employment, which is defined as net profit minus half of your self-employment tax and the elective deferrals you made.
Your combined contributions must not surpass $70,000, or $77,500 for individuals aged 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 guarantees a set amount to business owners upon retirement. As opposed to defined contribution plans, a defined benefit plan doesn't fluctuate based on investment returns, but lets individuals clearly understand what they'll receive in retirement. This strategy is best suited for wealthier entrepreneurs who want to save a substantial amount for retirement and are prepared to contribute substantial contributions. Contributions are tax deferred, and withdrawals are taxable as income during retirement.
Eligibility: Entrepreneurs running an owner-only business or with less than five employees may establish an individual defined benefit plan, but it's most commonly recommended for people above age 50 who earn at least $250,000 a year. Generally, good candidates for defined benefit plans include:
- Partners or owners who aim to deposit more than $70,000 (or $77,500 for individuals 50 and older)
- Businesses currently investing 3-4% and are willing to do more
- Organizations showing consistent profit patterns
- Partners or owners over age 40 who desire to "catch up" or increase their retirement contributions rapidly
Contribution Limits: The contribution limit is calculated by an actuary determined by your income, age, and retirement goals. Allowable contributions are adjusted each year.
The Importance of a Financial Advisor in Lincoln, NE for Your Self-Employed Retirement Plan
Working with a financial advisor in Lincoln, NE specialized in self-employed retirement plans is an essential partner for those working for themselves. They have the expertise to help guide you through the challenges of retirement planning and develop a tailored strategy that aligns with your goals. Your advisor in Lincoln, NE will assess where you stand financially, understand your risk tolerance, and help you in selecting the best options about saving and investing for retirement. A key part of what we do for you includes:
- Guide you in choosing a plan that best fits your needs and goals
- Further adapt the plan to fit you personally even further
- Formalize a plan in writing in accordance with IRS guidelines
- Set up an asset trust plan
- Help you understand the plan's terms
- Review and modify your plan as needed
- Offer continued financial education and guidance to help you navigate your retirement journey
- Increase your retirement income by optimizing your social security benefits
Self-Employed Retirement Plans in Lincoln, NE: Correct Capital's Process
Self-employed individuals in Lincoln, NE who lack the time, interest, or knowledge to manage their own retirement planning themselves may end up overwhelmed when faced with their options. With Correct Capital, our Lincoln, NE financial advisors handle the majority of your retirement strategy for you, to help make meeting your future savings targets as easy as possible for you. We will guide you in creating your self-employed retirement plan in a quick, four-step process:
- Schedule a Call: In just 20 minutes, a member of our advisor team will assess if we're a good fit for you and your business. This initial call helps us learn about your needs with zero commitment or significant effort 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 enables us to craft a personalized strategy that aligns with your goals.
- Review Your Plan: Once we've developed a plan based on the information you provide, we'll meet with you and review your plan in detail to make sure it's clear and understand how it best correlates to your needs.
- Implementation and Monitoring: When we finalize on your plan, we'll set everything up so you can begin contributing. As time goes on, we'll check in and track your progress to ensure it stays suited to your needs.
Our Lincoln, NE financial advisors and retirement plan consultants serve as fiduciary advisors, who are obligated to they are legally and ethically bound to prioritize your needs above all else.
Other financial advisory services we offer in Lincoln, NE 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 Lincoln, NE
To you, your business is more than "just a business", and your Lincoln, NE financial advisors need to offer more than just good financial guidance. Correct Capital takes pride in, we make it a priority to understand our clients and their businesses to deliver customized self-employed retirement plans. All our clients in Lincoln, NE benefit from our I.O.U. promise: all of the advice you get from us 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.
