Self-employed retirement plans Orlando, FL. The independence of owning your own business in Orlando, FL offers many benefits of having a self-directed career. That said, this independence sometimes brings with a lack of security, especially when it comes to building your retirement fund, 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 would be better off looking into other possibilities. In addition to enjoying a financially stable retirement, partnering with a financial advisor in Orlando, FL to create your self-employed retirement plan can provide significant tax advantages that help you to move your business forward.
Few Orlando, FL financial advisory and retirement planning firms truly grasp the challenges faced by self-employed individuals better than Correct Capital. Our founder's father was a small business owner himself (read more of our story here), and Correct Capital take pride in assisting business owners in their retirement planning needs. We understand that your business and retirement aspirations go far beyond just monetary concerns, and we strive to create tailored solutions to meet your unique goals. Keep reading to learn more about your self-employed retirement plan options in Orlando, FL, or call Correct Capital at 877-930-401k or contact us online to speak with a small business financial advisor in Orlando, FL today.
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Why Orlando, FL Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals not only prepare you for the future, they also provide tangible benefits today. Offering flexibility in contributions to considerable tax savings, partnering with a financial advisor in Orlando, FL enables you to create your retirement plan to align with 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) provides the freedom to modify how much you save:
- Customizable Contributions: Save extra during profitable years and scale back when revenues are down, so your plan fits your cash flow.
- Roth Options: Opting for a Roth Solo 401(k) lets you settle taxes at the time of contribution, enabling you to withdraw tax-free later—an advantageous choice if you expect your tax rate is likely to rise in the future.
Save Money on Taxes
Self-employed retirement plans offer valuable tax benefits:
- Tax-Deductible Contributions: Contributions to a SIMPLE IRA reduce what you owe in taxes, helping you keep more of your income.
- 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 might access extra deductions as a self-employed individual. These regional incentives make these plans even more advantageous.
- Retirement Savings Contributions Credit (Saver’s Credit): Qualified participants can claim a tax credit of up to 50% of the first $2,000 put into 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 about how you invest:
- Diversified Portfolios: Spreading your investments across varied stocks, bonds, and alternatives can help reduce risk while still growing your retirement fund.
- Emergency Back-Up: Combining your retirement strategy and a financial buffer for your business helps you avoid dipping into savings during challenging periods and incurring penalties.
Plan for the Future of Your Orlando, FL Business
A thoughtful retirement strategy can assist you plan ahead for what’s next with your Orlando, FL business:
- Selling Your Business: When selling your business, plans like SEP IRAs or Solo 401(k)s remain your personal assets and don’t transfer with the business. These plans ensure the reliable income you’ll need later on. Keep in mind that while selling a business often leads to a capital gain, deposits into these plans are restricted by contribution limits (e.g., up to $7,000 for IRAs or as much as $70,000 for Solo 401(k)s, including catch-up contributions, according to plan rules).
- Minimizing Taxes: Making the most of retirement savings can reduce the taxes you’ll owe when you transfer your business.
- Succession Planning: Whether you’re transferring ownership, your retirement savings provide the funds you need as you make this shift. You might want to seek advice from a financial advisor who specializes in succession planning and retirement accounts to minimize tax burdens on the sale.
With the best-fit retirement strategy, you manage your financial future, cut down your tax obligations, and build a solid base for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Orlando, FL Now?
Time is one of the most crucial assets for building your retirement fund. Beginning sooner rather than later not only lets you accumulate a more substantial retirement fund but also reduces the financial burden of playing catch-up as you get older. Here’s why it pays to take action now:
The Cost of Waiting
Putting off saving for retirement may cause a significant impact on the total you’ll have when you reach retirement age. The biggest reason is compound interest—the financial principle where your investments earn returns, and those returns, then, earn even more returns. The longer your money has to grow, the more significant the impact of compounding.
Example: 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 contributes $7,500 annually to make up for lost time.
By age 65, with an assumption of 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 invested steadily can lead to substantial growth. Consider this example showing the impact of compound interest:
- Starting at age 25: If you invest $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: Contributing the same $200 per month would result in only $235,412.97* by age 65—a gap of over $260,000, just from a 10-year delay.
Saving early, the lower your annual savings needs each year to reach your retirement goals.
*The numbers shown in this scenario are estimates calculated using 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 intended as illustrative examples and do not guarantee future performance. Outcomes may change depending on variables including market conditions, fees, and personal factors. Always consult a financial advisor for custom recommendations.
Take Control of Your Financial Future
As a self-employed person in Orlando, FL, it is often the case that you put more emphasis on reinvesting in your business over saving for retirement. That said, initiating a plan now enables you to:
- Benefit from tax-deferred growth or penalty-free withdrawals in the future.
- Benefit from adjustable savings that adapt to your cash flow.
- Create a financial cushion that offers peace of mind, no matter how your business evolves.
Starting early, the less you’ll need to worry about catching up later in life. Building your retirement savings today means taking control of your financial future and giving yourself the opportunity to focus on your objectives—both for your future retirement and your Orlando, FL business.
Types of Self-Employed Retirement Plans
There are several retirement savings options open for entrepreneurs in Orlando, FL, each providing its own pros and cons. A financial advisor will guide you to understand the advantages and disadvantages of each choice and choose the one ideal for your circumstances. Generally speaking, your self-employed retirement plan options in Orlando, 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 standard IRA, the money you contribute is often tax-deductible, and returns grow free of current taxes, but money taken out during retirement are subject to income tax. In contrast, Roth IRAs require contributions are made with after-tax income, but qualified withdrawals in retirement, including earnings, are tax-free. In both accounts, withdrawals come without penalties provided you are at least 59½.
Eligibility: Unlike plans linked to your job, both traditional and Roth IRAs are open to those 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 is a retirement plan 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 beyond the 25% you (the employer) allocate. 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. SEP IRAs is a good option for companies with periods of inconsistent earnings. Compared to other retirement options, SEP IRAs lack the high fees associated with starting or maintaining other plans.
SEPs function like standard IRAs, where you contribute pre-tax dollars and money withdrawn is subject to income tax.
Eligibility: Both employers and self-employed individuals can set up 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
If you’re self-employed, the contribution you can make is based on a special calculation.
Solo 401(k)
Plan Overview: Solo 401(k)s, sometimes referred to as an Individual 401(k) or one-participant 401(k) plan, is a self-employed retirement plan meant for businesses without employees or where the only employee is a spouse. Solo 401(k)s operate much like standard 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 can be balanced by more limited investment options. In a solo 401(k) plan, you can make either traditional or Roth deferrals, which have the same tax benefits as their IRA contribution counterparts.
Eligibility: Solo 401(k)s are available solely to 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 can make two types of contributions:
- Employee contributions of up to 100% of your self-employed earnings, up to the annual contribution limit. The contribution limits for 2025 include $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 self-employment income, which is your net profit minus half of your self-employment tax and the deferrals you made.
The total contribution cannot exceed $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: A defined benefit plan offers a structured retirement solution that guarantees a fixed, predetermined benefit to business owners upon retirement. In contrast to the plans discussed earlier, investment returns don’t affect the payout, but lets individuals clearly understand exactly how much they'll receive in retirement. This plan is recommended for high-earning self-employed individuals who are focused on saving a substantial amount for retirement and are willing to make sizeable contributions. Contributions offer tax-deferred growth, and withdrawals are taxed as income during retirement.
Eligibility: Self-employed professionals running an owner-only business or with a small staff of under five may establish an individual defined benefit plan, but it's most commonly suggested for those over 50 who earn at least $250,000 a year. 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 individuals 50 and older)
- Businesses currently investing 3-4% with plans to contribute more
- Companies with proven consistent profit patterns
- Partners or owners over age 40 who aim to quickly build retirement savings or increase their retirement contributions rapidly
Contribution Limits: The cap on contributions requires calculation from an actuary based on your earnings, age, and retirement objectives. Allowable contributions change annually.
The Importance of a Financial Advisor in Orlando, FL for Your Self-Employed Retirement Plan
Working with a financial advisor in Orlando, FL focused on self-employed retirement strategies serves as an essential partner for entrepreneurs. They bring the skills needed to understand the intricacies of saving for retirement and craft a tailored strategy that matches your objectives. Your advisor in Orlando, FL will assess where you stand financially, identify your risk preferences, and help you in making informed decisions about saving and investing for retirement. A key part of what we do for you features:
- Assist in selecting a plan that aligns with your objectives and circumstances
- Further adapt the plan to your needs even further
- Formalize a plan in writing that complies with IRS regulations
- Arrange a trust plan for assets
- Make sure you understand the plan's terms
- Monitor and adjust your plan to keep it aligned with your goals
- Offer continued financial education and guidance throughout your retirement planning process
- Boost your retirement earnings by making the most of your social security
Self-Employed Retirement Plans in Orlando, FL: Correct Capital's Process
Orlando, FL business owners who lack the time, interest, or knowledge to manage their own retirement planning themselves can become overwhelmed by their available plans. Through our team at Correct Capital, our Orlando, FL financial advisors handle the bulk of your savings plan setup for you, and strive to ensure meeting your retirement goals 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: A quick 20-minute call is all it takes, a member of our advisor team can determine if we're a good fit for you and your business. This initial call allows us to learn about your needs with zero commitment or major time investment on your part.
- Gather Information: Should we agree to proceed, we'll ask for information, including whether you have employees, your existing financial picture, and your retirement goals. This allows us to put together a tailored approach that aligns with your goals.
- Review Your Plan: When we finalize a plan using the information you provide, we'll schedule a meeting and review your plan thoroughly to help you fully grasp it and explain its fit to your circumstances.
- Implementation and Monitoring: After we agree on your plan, we'll put everything in place so you can start saving. Throughout our relationship, we'll meet with you and review your strategy to ensure it stays suited to your needs.
Our Orlando, FL financial advisors and retirement plan consultants are fiduciary advisors, which means they are committed by law and ethics to prioritize your needs above all else.
Other financial advisory services we offer in Orlando, FL include:
- 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 Orlando, FL
Your business isn't "just a business" to you, and your Orlando, 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 provide tailored self-employed retirement plans. We offer all our Orlando, FL clients our I.O.U. promise: all guidance we provide will be independent, objective, and unbiased. To take the first step on your self-employment retirement plan, call Correct Capital today at 877-930-401k or contact us online.
