Self-employed retirement plans Miami, FL. The flexibility of running your own company in Miami, FL offers many benefits of being self-employed. However, this freedom can come with certain challenges, particularly in terms of building your retirement fund, as you don't have the option of employer-sponsored retirement plans. 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, seeking advice from a financial advisor in Miami, FL to establish your self-employed retirement plan can provide significant tax advantages that allow your business to grow and succeed.
Few Miami, FL investment consulting and retirement planning firms are as attuned to the requirements of entrepreneurs as well as Correct Capital. The father of our founder was a small business owner himself (read more of our story here), and Correct Capital have a rich history of supporting entrepreneurs with their retirement planning needs. We know that your goals for your business and retirement go far beyond simple financial figures, and we work tirelessly to provide personalized solutions that reflect your objectives. Continue exploring to find out about your self-employed retirement plan options in Miami, FL, or give us a call at Correct Capital at 877-930-401k or contact us online to consult with a self-employed 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 are essential for preparing you for the future, they also deliver real benefits today. Offering flexibility in contributions to considerable tax savings, consulting a financial advisor in Miami, FL allows you to customize your retirement plan to suit your specific needs.
Flexibility That Fits Your Income
For those with fluctuating income from year to year, a plan like a SEP IRA or Solo 401(k) provides the flexibility to modify how much you save:
- Customizable Contributions: Set aside more during successful years and reduce savings when your earnings dip, so that your plan fits your cash flow.
- Roth Options: Opting for a Roth Solo 401(k) lets you handle taxes upfront, enabling you to withdraw without tax penalties in the future—a smart decision if you expect your tax rate to be higher in the future.
Save Money on Taxes
Plans designed for the self-employed provide significant tax benefits:
- Tax-Deductible Contributions: Contributions to a Solo 401(k) reduce what you owe in taxes, allowing you to keep more of your income.
- Tax-Deferred Growth: You won't pay taxes on investment growth until you withdraw it, which gives your money more time to compound.
- State-Specific Incentives: Depending on where you live, you could qualify for extra tax breaks as a self-employed individual. These state-level incentives make these plans even more advantageous.
- 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, cutting down 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: Allocating your investments across varied asset classes like stocks and bonds can help mitigate financial risk while still growing your savings.
- Emergency Back-Up: Pairing your retirement plan with a dedicated business safety net ensures you don’t dipping into savings during financial hardships and facing tax penalties.
Plan for the Future of Your Miami, FL Business
Preparing for retirement can assist you prepare for what’s next with your Miami, FL business:
- Selling Your Business: When selling your business, retirement accounts like SEP IRAs and Solo 401(k)s stay in your name and are not part of the sale. These plans ensure the steady income you’ll need later on. Keep in mind that while selling your business results in a capital gain, contributions to retirement accounts are subject to yearly maximums (e.g., as much as $7,000 for IRAs or up to $70,000 for Solo 401(k)s, including catch-up contributions, based on plan compensation).
- Minimizing Taxes: Strategically planning your contributions minimizes the taxes you’ll owe when you pass on your business.
- Succession Planning: If you’re passing the business on, your nest egg offer a stable foundation through the transition. You may also seek advice from a financial advisor with expertise in succession and retirement planning to minimize tax burdens on the sale.
With the best-fit retirement strategy, you manage your financial future, reduce your tax burden, and create a secure foundation for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Miami, FL Now?
Time remains one of the most crucial resources in retirement planning. Starting early not only helps you grow a more substantial retirement fund but also reduces the pressure of catching up later in life. This is why it makes sense to begin today:
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 earn returns, and those returns, subsequently, earn even more returns. The more time your money has to grow, the greater the benefit of this growth.
Example: Alex and Taylor are both entrepreneurs. Their shared goal is 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 contributes $7,500 annually to make up for lost time.
By age 65, with an assumption of 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 may result in impressive growth. Take a look at this scenario showing the power of compounding:
- Starting at age 25: By investing $200 per month in a retirement plan with an projected return of 7%, you’ll end up with $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 gap of over $260,000, just from a 10-year delay.
Starting sooner, the less effort required each year to reach your retirement goals.
*The figures provided in this example are estimates derived from 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. The scenarios provided are for illustrative purposes only and do not guarantee future performance. Your individual results may differ due to variables including market conditions, fees, and your unique situation. We recommend consulting a financial advisor for guidance tailored to your needs.
Take Control of Your Financial Future
If you’re self-employed in Miami, FL, it can be tempting to prioritize reinvesting in your business instead of saving for retirement. Even so, starting a plan now allows you to:
- Leverage tax-free future growth or withdrawals without taxes down the road.
- Enjoy contribution flexibility that adapt to your income.
- Create a financial cushion that provides security, no matter how your business evolves.
Starting early, the less you’ll have to worry about playing catch-up later in life. Saving for retirement now means taking control of your financial future and giving yourself the ability to concentrate on your objectives—both for your golden years and your Miami, FL business.
Types of Self-Employed Retirement Plans
There are several retirement savings options open for those working for themselves in Miami, FL, each providing its own benefits and trade-offs. A financial advisor can help you understand the advantages and disadvantages of each choice and determine the one best suited for your needs. Typically, your self-employed retirement plan options in Miami, FL consist of:
Traditional or Roth IRA
Plan Overview: IRAs, or Individual Retirement Accounts, are long-term savings plans that offer distinct tax benefits. In a standard IRA, contributions are typically tax-deductible, and investment earnings grow tax-deferred, but retirement distributions are taxed as income. In contrast, with Roth IRAs, you contribute from post-tax earnings, but eligible distributions during retirement, including earnings, are not taxed. In both types of accounts, withdrawals don’t incur penalties provided you are at least 59½.
Eligibility: While many retirement plans, such as 401(k)s, are tied to employment, traditional and Roth IRAs are accessible for individuals with an earned income.
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 offers a way to save for retirement that permits self-employed individuals to save a percentage of their net business profits. Contributions must come from an employer, so, as a independent business owner, you (the employee) would not be able to contribute more than the 25% you (the employer) already contributed. 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 entrepreneurs facing cycles of high revenue and low revenue. Unlike other plans, SEP IRAs don’t have expensive setup or ongoing fees.
SEPs work like standard IRAs, where the contributions are tax-deferred and money withdrawn is subject to income tax.
Eligibility: Employers of any type, including self-employed individuals can open 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 contribution you can make is based on a special calculation.
Solo 401(k)
Plan Overview: A Solo 401(k) plan, sometimes referred to as an Individual 401(k) or one-participant 401(k) plan, is a self-employed retirement plan meant for businesses with no employees or when the sole employee is your spouse. This type of plan function similarly to traditional employer-managed 401(k) plans, and enable contributions as both the employer and the employee with pre-tax money. This offers more savings versus SEPs or IRAs; however, the extra savings options often come with more limited investment options. Using a solo 401(k), 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 can set up 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:
- Deferrals as an employee of up to 100% of your self-employed earnings, capped at the annual contribution limit. The contribution limits for 2025 include $23,500, or $31,000 for those aged 50 and above, or $34,750 if you attain age 60-63 in 2025.
- Contributions as an employer (as an employer) must not surpass 25% of your adjusted self-employment income, which is defined as 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 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 is a retirement option that delivers a fixed, predetermined benefit 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 exactly how much they'll receive in retirement. This plan is best suited for high-earning self-employed individuals who want to save a substantial amount for retirement and are willing to make substantial contributions. Contributions offer tax-deferred growth, and withdrawals incur taxes as income in retirement.
Eligibility: Any self-employed individual running an owner-only business or with less than five employees may establish an individual defined benefit plan, but it's generally advised for individuals aged 50+ who generate a minimum of $250,000 yearly. Generally, good candidates for defined benefit plans tend to be:
- Business owners or partners who desire to contribute more than $70,000 (or $77,500 for those aged 50+)
- Companies already contributing 3-4% with plans to contribute more
- Organizations with proven consistent profit patterns
- Entrepreneurs over age 40 who wish to accelerate savings or accelerate the retirement savings
Contribution Limits: The cap on contributions is calculated by an actuary determined by your income, age, and retirement goals. Limits on contributions are updated yearly.
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 can be an invaluable resource for those working for themselves. They have the expertise to help understand the intricacies of saving for retirement and develop a personalized approach 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. Part of what we do for you involves:
- Help you choose a plan that suits your unique requirements
- Tailor the plan to your specific situation even further
- Formalize a plan in writing that complies with IRS regulations
- Organize a trust plan to manage your assets
- Make sure you understand the plan's terms
- Track and fine-tune 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 optimizing your social security benefits
Self-Employed Retirement Plans in Miami, FL: Correct Capital's Process
Entrepreneurs in Miami, FL who aren’t equipped with the time or understanding to handle their own retirement planning on their own can become overwhelmed as they look at their choices. Through our team at Correct Capital, our Miami, FL financial advisors handle the bulk of your retirement strategy for you, working to make meeting your retirement goals as hassle-free as possible for you. We can help you get set up your self-employed retirement plan in just four steps:
- Schedule a Call: It only takes 20 minutes, a member of our advisor team will assess if we're suited to your needs for you and your business. This initial call allows us to get a sense of your goals with zero commitment or extensive time commitment on your part.
- Gather Information: If we both decide to move forward, we'll request information, including your employee count, your present financial standing, and your retirement goals. This helps us create a custom plan that aligns with your goals.
- Review Your Plan: When we finalize a plan from the information you provide, we'll meet with you and discuss your plan thoroughly to make sure it's clear and understand how it best correlates to your needs.
- Implementation and Monitoring: After we agree on your plan, we'll put everything in place so you can start saving. Over the course of our partnership, we'll check in and track your progress to ensure it stays suited to your needs.
Our Miami, FL financial advisors and retirement plan consultants are fiduciary advisors, which means they are legally and ethically bound to prioritize your needs above all else.
Other financial advisory services we offer in Miami, FL include:
- Independent Financial Advisor
- Roth Conversion
- Investment Management
- 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
Your business isn't "just a business" to you, and your Miami, FL financial advisors should provide more than just good financial guidance. At Correct Capital, we make it a priority to understand our clients and their businesses to deliver personalized self-employed retirement plans. To every client in Miami, FL, we provide our I.O.U. promise: everything we recommend will be independent, objective, and unbiased. To begin on your self-employment retirement plan, contact Correct Capital now at 877-930-401k or contact us online.
