Self-employed retirement plans Miami, FL. The independence of running your own company in Miami, FL is one of the best aspects of working for yourself. Even so, this independence often comes with potential drawbacks, notably regarding building your retirement fund, as you don't have the benefit of retirement programs through an employer. Only 13% of self-employed individuals have a workplace retirement plan, but many should consider looking into other possibilities. In addition to having a more secure retirement, working with a financial advisor in Miami, FL to establish your self-employed retirement plan delivers significant tax advantages that enable both you and your business to thrive.
Few Miami, FL investment consulting and retirement planning firms truly grasp the challenges faced by entrepreneurs quite like Correct Capital. Our founder's father was a small business owner himself (check out our story here), and we have a rich history of assisting business owners in their retirement planning needs. We recognize that your goals for your business and retirement extend well past just monetary concerns, and we work tirelessly to create customized solutions to meet your unique goals. Keep reading to learn more about your self-employed retirement plan options in Miami, FL, or reach out to Correct Capital at 877-930-401k or contact us online to speak with a entrepreneurial financial advisor in Miami, FL today.
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Why Miami, FL Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals help prepare you for the future, they also deliver tangible benefits today. From flexible contributions to considerable tax savings, partnering with a financial advisor in Miami, FL allows you to customize your retirement plan to suit your individual circumstances.
Flexibility That Fits Your Income
When your earnings vary 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 high-income years and scale back 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 your savings tax-free down the road—an advantageous choice if you expect your tax rate to be higher in the future.
Save Money on Taxes
Plans designed for the self-employed deliver powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a SEP IRA lower your taxable income, helping you keep more of your hard-earned money.
- Tax-Deferred Growth: Your savings grow untaxed until withdrawn, providing your money more time to grow.
- State-Specific Incentives: Based on your location, you could qualify for extra deductions as a business owner. These local incentives can make these plans even more beneficial.
- Retirement Savings Contributions Credit (Saver’s Credit): Those who meet the requirements can claim a tax credit of up to 50% of the first $2,000 they contribute a retirement plan, further reducing your tax bill even more.
Protect Your Savings With Smart Investments
Building a secure retirement isn’t only about how much you save—it’s also linked to the way you invest:
- Diversified Portfolios: Allocating your investments across different stocks, bonds, and other assets can help mitigate financial risk while helping to grow your nest egg.
- Emergency Back-Up: Pairing your retirement plan with a financial buffer for your business prevents you from tapping into your nest egg during financial hardships and facing tax penalties.
Plan for the Future of Your Miami, FL Business
A thoughtful retirement strategy enables you to prepare for what’s next with your Miami, FL business:
- Selling Your Business: If you’re planning to sell, retirement accounts like SEP IRAs and Solo 401(k)s remain yours and won’t be included in the sale. These savings ensure the financial stability you’ll need during retirement. Remember that while selling your business results in a capital gain, retirement plan contributions are subject to yearly maximums (e.g., a maximum of $7,000 for IRAs or up to $70,000 for Solo 401(k)s, factoring in catch-up contributions, depending on plan details).
- Minimizing Taxes: Strategically planning your contributions helps lower 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 as you make this shift. You may also partner with a financial advisor with expertise in succession and retirement planning to minimize tax burdens during the sale.
With the right retirement plan, you can take control of your financial future, reduce your tax burden, and create a solid base for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Miami, FL Now?
Time is one of the most valuable factors in retirement planning. Starting early not only helps you grow a more substantial retirement fund but also lowers the financial burden of catching up later in life. Here’s why it pays to take action now:
The Cost of Waiting
Delaying your retirement savings can have a substantial impact on the total you’ll have when you stop working. The biggest reason is compound interest—the concept where your investments grow, and those returns, then, generate even more returns. The greater time span your money has to grow, the greater the benefit of this growth.
Example: Taylor and Alex are both entrepreneurs. They each aim to save $500,000 for retirement by age 65:
- Alex begins contributing $5,000 annually at age 30.
- Taylor delays savings until age 40 but puts away $7,500 annually to bridge the gap.
By age 65, assuming 7% annual return:
- Alex contributes $180,000 and accumulates $691,184.39*.
- Taylor puts in $195,500 but only ends up with $474,367.78*.
How Early Contributions Grow
Regular, modest investments made consistently can lead to substantial growth. Consider this example showing the power of compounding:
- Starting at age 25: If you invest $200 per month in a retirement plan with an projected return of 7%, you’ll accumulate $497,303.29* by age 65.
- Starting at age 35: Saving 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 numbers shown in this scenario are estimates generated with NerdWallet’s Compound Interest Calculator, with the assumption of a 7% annual return. These calculations involved multiplying yearly deposits by the years contributed. These examples are meant to provide general guidance and do not guarantee future performance. Your individual results may differ due to factors such as market conditions, fees, and individual circumstances. We recommend consulting a financial advisor for guidance tailored to your needs.
Take Control of Your Financial Future
As a self-employed person in Miami, FL, it can be tempting to put more emphasis on reinvesting in your business instead of saving for retirement. Even so, starting a plan now gives you the chance to:
- Benefit from tax-free future growth or withdrawals without taxes in the future.
- Take advantage of contribution flexibility that align with your earnings.
- Establish a long-term safety measure that offers peace of mind, no matter how your business develops.
Getting started now, the less you’ll have 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 ability to focus on your objectives—both for your future retirement and your Miami, FL business.
Types of Self-Employed Retirement Plans
A variety of retirement savings options designed for those working for themselves in Miami, FL, each providing its own pros and cons. A financial advisor can help you learn about the advantages and disadvantages of each option and determine the one ideal for your unique situation. Typically, your self-employed retirement plan options in Miami, FL include:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent retirement savings vehicles that include key tax perks. In a traditional IRA, contributions are typically tax-deductible, and investment earnings grow tax-deferred, but withdrawals in retirement are taxable. In contrast, Roth IRAs require contributions using income already taxed, but eligible distributions during retirement, including earnings, are not taxed. In both types of accounts, withdrawals are penalty-free if you are at least 59½.
Eligibility: Unlike plans linked to your job, IRAs, including traditional and Roth options are accessible for individuals 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: The Simplified Employee Pension IRA serves as a retirement savings option that enables self-employed individuals to contribute a percentage of their net earnings. Contributions can only be made by an employer, so, as a self-employed individual, you (the employee) are limited to contributions from the employer role 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. You may choose to contribute a flat-dollar amount or a percentage of wages to employee accounts. This type of plan may be ideal for companies with cycles of high revenue and low revenue. In contrast to some alternatives, SEP IRAs don’t have the high fees associated with starting or maintaining other plans.
SEPs operate like traditional IRAs, where you contribute pre-tax dollars and withdrawals are taxed as income.
Eligibility: Both employers and self-employed individuals can set up a SEP.
Contribution Limits: Contribution limits for employees in a SEP IRA must not exceed:
- 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: A Solo 401(k) plan, commonly known as an Individual 401(k) or one-participant 401(k) plan, is a savings option for the self-employed intended for companies that have no employees or when the sole employee is your spouse. Solo 401(k)s operate much like traditional employer-managed 401(k) plans, and enable contributions as both an employee or an employer with pre-tax money. This offers more savings compared to SEPs or IRAs; however, the additional opportunities often come with more limited investment options. With this type of plan, you can make either traditional or Roth deferrals, which share the same tax benefits as their IRA contribution counterparts.
Eligibility: Only 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:
- Employee contributions of up to 100% of your self-employment income, 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 individuals aged 60-63 in 2025.
- Employer profit-sharing contributions (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 deferrals you made.
Total contributions are capped at $70,000, or $77,500 for individuals aged 50+ (for 2025), $81,250 for those aged 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: Defined benefit plans represents a type of retirement plan that guarantees a set amount to entrepreneurs upon retirement. In contrast to the plans discussed earlier, investment returns don’t affect the payout, but enables participants to determine the precise amount they'll get in retirement. This plan is recommended for high-earning entrepreneurs who are focused on saving a large amount for retirement and can commit to making larger deposits. Contributions offer tax-deferred growth, and withdrawals are taxed as income during 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 recommended for people above age 50 who earn at least $250,000 a year. In most cases, good candidates for defined benefit plans are:
- Partners or owners who desire to contribute more than $70,000 (or $77,500 for individuals 50 and older)
- Companies already contributing 3-4% but are open to increasing contributions
- Businesses with proven consistent profit patterns
- Business leaders over age 40 who desire to "catch up" or accelerate the retirement savings
Contribution Limits: The contribution limit must be determined by an actuary using your income, age, and retirement goals. Contribution limits change annually.
The Importance of a Financial Advisor in Miami, FL for Your Self-Employed Retirement Plan
Working with a financial advisor in Miami, FL experienced with retirement plans for the self-employed serves as an invaluable resource for entrepreneurs. They have the expertise to help guide you through the challenges of retirement planning and design a personalized approach that aligns with your goals. An expert in your area will review your finances, understand your risk tolerance, and help 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 suits your unique requirements
- Further adapt the plan to fit you personally even further
- Create a written plan that complies with IRS regulations
- Set up an asset trust plan
- Make sure you understand the plan's terms
- Review and modify your plan as needed
- Offer continued financial education and guidance as you continue on the road to retirement
- Maximize what you receive in retirement by maximizing your social security benefits
Self-Employed Retirement Plans in Miami, FL: Correct Capital's Process
Self-employed individuals in Miami, FL who aren’t equipped with the time or understanding to oversee their own retirement planning independently often feel overwhelmed when faced with their options. At Correct Capital, our Miami, FL financial advisors manage the bulk of your savings plan setup for you, and strive to ensure meeting your financial objectives as straightforward as possible for you. We will guide you in creating your self-employed retirement plan in four simple steps:
- Schedule a Call: It only takes 20 minutes, a member of our advisor team can determine if our services align for you and your business. This initial call allows us to understand what you're looking for with no obligation or significant effort on your part.
- Gather Information: Once we mutually decide to continue, we'll ask for information, including whether you have employees, your existing financial picture, and your long-term savings targets. This helps us create a personalized strategy designed just for you.
- Review Your Plan: After we put together a plan using the information you provide, we'll schedule a meeting and review your plan thoroughly to ensure you understand it and show how it aligns with your goals.
- Implementation and Monitoring: After we agree on your plan, we'll implement the necessary steps so you can initiate your savings journey. Throughout our relationship, we'll check in and monitor your plan to make sure it remains aligned with your goals.
Our Miami, FL financial advisors and retirement plan consultants act as fiduciary advisors, which means they are committed by law and ethics to act in your best interest.
Other financial advisory services we offer in Miami, FL 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 Miami, FL
You don't see your business as "just a business", and your Miami, FL financial advisors should provide 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 create personalized self-employed retirement plans. All our clients in Miami, FL 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, call Correct Capital today at 877-930-401k or contact us online.
