Self-employed retirement plans Milwaukee, WI. The freedom of running your own company in Milwaukee, WI is one of the best aspects of having a self-directed career. That said, this freedom often comes with certain challenges, particularly when it comes to retirement savings, since 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 understanding their retirement options. In addition to enjoying a more secure retirement, working with a financial advisor in Milwaukee, WI to establish your self-employed retirement plan delivers significant tax advantages that help both you and your business to thrive.
Few Milwaukee, WI financial advisory and retirement planning firms understand the needs of entrepreneurs as well as Correct Capital. Our company’s founder grew up with a father who was a small business owner himself (check out our story here), and Correct Capital have a rich history of assisting business owners in their retirement planning needs. We know that your business and retirement aspirations go far beyond basic numbers, and we work tirelessly to offer tailored solutions that reflect your objectives. Continue exploring to find out about your self-employed retirement plan options in Milwaukee, WI, or reach out to Correct Capital at 877-930-401k or contact us online to consult with a entrepreneurial financial advisor in Milwaukee, WI today.
Why Milwaukee, WI Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals not only prepare you for the future, they also deliver tangible benefits today. With customizable contribution options to significant tax savings, working with a financial advisor in Milwaukee, WI helps you create your retirement plan to suit your individual circumstances.
Flexibility That Fits Your Income
If your income changes from year to year, a plan like a SEP IRA or Solo 401(k) provides the freedom to tailor how much you save:
- Customizable Contributions: Set aside more during profitable years and cut back when income is lower, so that your plan works with your current income.
- Roth Options: A Roth Solo 401(k) lets you pay taxes on contributions now, so you can withdraw tax-free later—a wise move if you expect your tax rate is likely to rise in the future.
Save Money on Taxes
Plans designed for the self-employed provide powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a SIMPLE IRA shrink your tax liability, helping you keep more of your hard-earned money.
- 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: Based on your location, you could qualify for additional deductions as a sole proprietor. These state-level incentives help make these plans even more beneficial.
- Retirement Savings Contributions Credit (Saver’s Credit): Those who meet the requirements can take advantage of a 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 requires more than how much you save—it’s also linked to the way you invest:
- Diversified Portfolios: Spreading your investments across different stocks, bonds, and alternatives serves to reduce risk while helping to grow your nest egg.
- Emergency Back-Up: Supplementing your retirement savings with a dedicated business safety net prevents you from dipping into savings during financial hardships and incurring penalties.
Plan for the Future of Your Milwaukee, WI Business
A thoughtful retirement strategy enables you to prepare for what’s next with your Milwaukee, WI business:
- Selling Your Business: For those considering a sale, accounts such as SEP IRAs or Solo 401(k)s stay in your name and are not part of the sale. These accounts ensure the steady income you’ll need in the future. Keep in mind that while selling a business often leads to a capital gain, deposits into these plans are subject to yearly maximums (e.g., a maximum of $7,000 for IRAs or up to $70,000 for Solo 401(k)s, including catch-up contributions, based on plan compensation).
- Minimizing Taxes: Using retirement contributions wisely can reduce the taxes you might face when you sell your business.
- Succession Planning: If you’re passing the business on, your retirement savings offer the funds you need through the transition. You might want to seek advice from a financial advisor experienced in both succession and retirement strategies to reduce taxes during the sale.
With the right retirement plan, you manage 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 Milwaukee, WI Now?
Time remains one of the most crucial assets when it comes to saving for retirement. Starting early not only allows you to build a more substantial retirement fund but also reduces the financial burden of playing catch-up as you get older. The following are reasons why it is beneficial to start now:
The Cost of Waiting
Waiting to start your retirement fund can have a significant impact on the savings you’ll have when you stop working. The biggest reason is compound interest—the financial principle where your investments earn returns, and those returns, in turn, earn even more returns. The longer your money has to grow, the larger the benefit of this compounding process.
Example: Two individuals, Alex and Taylor are both self-employed professionals. Their shared goal is to save $500,000 for retirement by age 65:
- Alex starts saving $5,000 annually at age 30.
- Taylor delays savings until age 40 but puts away $7,500 annually to make up for lost time.
By age 65, using a projected 7% annual return:
- Alex contributes $180,000 and achieves a total of $691,184.39*.
- Taylor puts in $195,500 but accumulates just $474,367.78*.
How Early Contributions Grow
Regular, modest investments contributed over time may result in significant growth. Consider this example showing the effect 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: Saving the same $200 per month would result in only $235,412.97* by age 65—a difference of over $260,000, simply due to a 10-year delay.
The earlier you begin, the less you need to save each year to achieve your retirement goals.
*These calculations represent 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. These examples are for illustrative purposes only and are not a promise of future results. Actual results may vary due to factors such as market conditions, fees, and personal factors. Be sure to speak with a financial advisor for guidance tailored to your needs.
Take Control of Your Financial Future
If you’re self-employed in Milwaukee, WI, it can be tempting to prioritize reinvesting in your business instead of saving for retirement. That said, initiating a plan now allows you to:
- Take advantage of tax-deferred growth or withdrawals without taxes later on.
- Take advantage of adjustable savings that adapt to your cash flow.
- Build a financial cushion 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 giving yourself the freedom to turn your attention to your goals—both for your future retirement and your Milwaukee, WI business.
Types of Self-Employed Retirement Plans
Multiple retirement savings options open for self-employed individuals in Milwaukee, WI, each with its own pros and cons. A financial advisor will guide you to evaluate the advantages and disadvantages of each option and identify the one ideal for your circumstances. Typically, your self-employed retirement plan options in Milwaukee, WI include:
Traditional or Roth IRA
Plan Overview: IRAs, or Individual Retirement Accounts, are financial tools for retirement that provide key tax perks. In a standard IRA, the money you contribute is often tax-deductible, and returns grow free of current taxes, but withdrawals in retirement are subject to income tax. In contrast, with Roth IRAs, you contribute using income already taxed, but retirement withdrawals that qualify, including earnings, are exempt from taxes. In both types of accounts, withdrawals come without penalties as long as you are at least 59½.
Eligibility: Unlike 401(k)s, which are employer-sponsored, traditional and Roth IRAs are available to anyone with taxable earnings.
Contribution Limits: For 2025, annual contribution limits for IRAs are set at $7,000, or $8,000 if you're 50 or older.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: SEP IRAs serves as a retirement savings option that permits entrepreneurs 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 more than the 25% you (the employer) allocate. If you have employees, you must 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. A SEP IRA works well for entrepreneurs facing cycles of high revenue and low revenue. Compared to other retirement options, SEP IRAs lack the high fees associated with starting or maintaining other plans.
SEPs operate like conventional 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 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 self-employed retirement plan designed for businesses without employees or when the sole employee is your spouse. Solo 401(k)s function similarly to employer-sponsored 401(k) plans, and allow you to contribute as both the employer and the employee with pre-tax money. This offers more savings than SEPs or IRAs; however, the increased savings potential often come with more constrained investment avenues. 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: For self-employed individuals 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 earned income from self-employment, subject to the annual contribution limit. In 2025, those limits are $23,500, or $31,000 if you are 50 or older, or $34,750 for those who turn 60-63 in 2025.
- Contributions as an employer (as an employer) must not surpass 25% of your net earnings from self-employment, which is calculated as net profits less half of your self-employment tax and the employee contributions you made.
Total contributions are capped at $70,000, or $77,500 for those aged 50 and older (in 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 self-employed individuals upon retirement. In contrast to the plans discussed earlier, investment returns don’t affect the payout, but allows self-employed individuals to know what they'll have in retirement. This plan is recommended for wealthier self-employed individuals who want to save a large amount for retirement and are prepared to contribute sizeable contributions. Contributions offer tax-deferred growth, and withdrawals are taxed as income upon retirement.
Eligibility: Entrepreneurs operating a solo business or employing fewer than five people are eligible to open an individual defined benefit plan, but it's generally recommended for people above age 50 who earn at least $250,000 a year. In most cases, good candidates for defined benefit plans are:
- Entrepreneurs who want to invest more than $70,000 (or $77,500 for individuals 50 and older)
- Companies already contributing 3-4% and are willing to do more
- Organizations that have demonstrated consistent profit patterns
- Business leaders over age 40 who wish to accelerate savings or increase their retirement contributions rapidly
Contribution Limits: The cap on contributions is calculated by an actuary based on your financial situation, age, and savings targets. Limits on contributions are adjusted each year.
The Importance of a Financial Advisor in Milwaukee, WI for Your Self-Employed Retirement Plan
A financial advisor in Milwaukee, WI specialized in self-employed retirement plans serves as an invaluable resource for entrepreneurs. They have the expertise to help navigate the complexities of retirement planning and design a personalized approach that aligns with your goals. A financial advisor in Milwaukee, WI will review your finances, determine how much risk you’re comfortable with, and help you in choosing wisely about saving and investing for retirement. Included in what we do for you involves:
- Assist in selecting a plan that suits your unique requirements
- Customize the plan to your needs even further
- Adopt a written plan as required by IRS rules
- 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 to help you navigate your retirement journey
- Increase your retirement income by maximizing your social security benefits
Self-Employed Retirement Plans in Milwaukee, WI: Correct Capital's Process
Milwaukee, WI business owners who aren’t equipped with the time or understanding to handle their own retirement planning independently often feel overwhelmed when faced with their available plans. At Correct Capital, our Milwaukee, WI financial advisors handle the majority of your retirement planning for you, to help 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 we're suited to your needs for you and your business. This brief introduction allows us to understand what you're looking for with zero commitment or significant effort on your part.
- Gather Information: Once we mutually decide to continue, we'll gather information, including whether you have employees, your existing financial picture, and your future objectives. This helps us create a tailored approach suited specifically for your needs.
- Review Your Plan: When we finalize a plan using the information you provide, we'll sit down with you and review your plan in detail to ensure you understand it and show how it aligns with your goals.
- Implementation and Monitoring: After we agree on your plan, we'll set everything up so you can start saving. Throughout our relationship, we'll have regular meetings and monitor your plan to ensure it stays suited to your needs.
Our Milwaukee, WI financial advisors and retirement plan consultants are fiduciary advisors, which means they are committed by law and ethics to do what's in your best interest.
Other financial advisory services we offer in Milwaukee, WI include:
- Investment Planning
- Retirement Financial Planning
- Independent Financial Advisor
- Roth Conversion
- Investment Management
- 401(k) Audit
- High-Net-Worth Wealth Management
- Retirement Planner
- Financial Planning
- Retirement Plan Consultants
Call Correct Capital for Your Self-Employed Retirement Plan in Milwaukee, WI
Your business isn't "just a business" to you, and your Milwaukee, WI financial advisors need to offer more than just good financial guidance. At Correct Capital, we make it a priority to understand our clients and their businesses to provide customized self-employed retirement plans. We offer all our Milwaukee, WI clients our I.O.U. promise: all of the advice you get from us will be independent, objective, and unbiased. To take the first step on your self-employment retirement plan, contact Correct Capital now at 877-930-401k or contact us online.
