Self-employed retirement plans Portland, OR. The independence of being your own boss in Portland, OR is one of the best aspects of working for yourself. However, this freedom often comes with certain challenges, especially regarding planning for retirement, since you don't have the option of a workplace retirement plan. Only 13% of self-employed individuals have a workplace retirement plan, although many should consider exploring their options. In addition to achieving a financially stable retirement, working with a financial advisor in Portland, OR to set up your self-employed retirement plan can provide significant tax advantages that allow you to move your business forward.
Few Portland, OR financial advisory and retirement planning firms understand the needs of small business owners quite like Correct Capital. The father of our founder was a small business owner himself (read more of our story here), and Correct Capital take pride in helping businesses with their retirement planning needs. We recognize that your professional and personal aspirations extend well past just monetary concerns, and we work tirelessly to create customized solutions to meet your unique goals. Read on to discover about your self-employed retirement plan options in Portland, OR, or reach out to Correct Capital at 877-930-401k or contact us online to speak with a small business financial advisor in Portland, OR today.
Why Portland, OR Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals not only prepare you for the future, they also offer immediate benefits today. From flexible contributions to significant tax savings, partnering with a financial advisor in Portland, OR enables you to customize your retirement plan to suit your specific needs.
Flexibility That Fits Your Income
If your income changes over time, 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 income is lower, so that your plan fits your current income.
- Roth Options: A Roth Solo 401(k) lets you pay taxes on contributions now, allowing you to withdraw without tax penalties in the future—an advantageous choice if you expect your tax rate is likely to rise in the future.
Save Money on Taxes
Plans designed for the self-employed provide valuable tax benefits:
- Tax-Deductible Contributions: Contributions to a SEP IRA reduce what you owe in taxes, so you can 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 accumulate.
- State-Specific Incentives: In some states, you may be eligible for additional deductions as a sole proprietor. These local incentives help make these plans even more advantageous.
- Retirement Savings Contributions Credit (Saver’s Credit): Qualified participants can take advantage of a credit of up to 50% of the first $2,000 put into 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 determined by your investment strategy:
- Diversified Portfolios: Distributing your investments across a mix of stocks, bonds, and alternatives can help reduce risk while still growing your nest egg.
- Emergency Back-Up: Supplementing your retirement savings with a business emergency fund prevents you from using your retirement funds during challenging periods and facing tax penalties.
Plan for the Future of Your Portland, OR Business
A thoughtful retirement strategy can assist you think through what’s next with your Portland, OR business:
- Selling Your Business: If you’re planning to sell, plans like SEP IRAs or Solo 401(k)s stay in your name and don’t transfer with the business. These plans can provide the financial stability you’ll need later on. It’s important to note that while the sale of a business usually creates a capital gain, contributions to retirement accounts are capped at annual limits (e.g., a maximum of $7,000 for IRAs or a maximum of $70,000 for Solo 401(k)s, including catch-up contributions, based on plan compensation).
- Minimizing Taxes: Making the most of retirement savings can reduce the taxes you might face when you transfer your business.
- Succession Planning: For those winding down or handing over their business, your retirement accounts offer the funds you need as you make this shift. You may also seek advice from a financial advisor who specializes in succession planning and retirement accounts to reduce taxes during the sale.
With the best-fit retirement strategy, you gain control over your financial future, reduce your tax burden, and build a secure foundation for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Portland, OR Now?
Time is one of the most important assets 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. This is why it pays to take action now:
The Cost of Waiting
Waiting to start your retirement fund could lead to a substantial impact on the savings you’ll have when you retire. The main reason is compound interest—the powerful process where your investments earn returns, and those returns, in turn, accumulate even more returns. The greater time span your money has to grow, the larger the effect of compounding.
Example: Alex and Taylor are both self-employed individuals. 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 puts away $7,500 annually to catch up.
By age 65, assuming 7% annual return:
- Alex puts in $180,000 and accumulates $691,184.39*.
- Taylor invests $195,500 but only ends up with $474,367.78*.
How Early Contributions Grow
Regular, modest investments made consistently may result in substantial growth. Here’s a simple scenario showing the impact of compound interest:
- Starting at age 25: By investing $200 per month in a retirement plan with an average annual 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 shortfall of over $260,000, all because of a 10-year delay.
Saving early, the less effort required each year to achieve your retirement goals.
*The numbers shown in this scenario are estimates derived from NerdWallet’s Compound Interest Calculator, assuming 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. Your individual results may differ due to variables including market conditions, fees, and personal factors. We recommend consulting a financial advisor for personalized advice.
Take Control of Your Financial Future
If you’re self-employed in Portland, OR, it might seem easier to put more emphasis on reinvesting in your business over saving for retirement. Even so, beginning a plan now enables you to:
- Leverage growth that is tax-deferred or penalty-free withdrawals in the future.
- Enjoy adjustable savings that change with your earnings.
- Establish a long-term safety measure that offers peace of mind, no matter how your business changes.
Starting early, the less you’ll have to worry about playing catch-up later in life. Building your retirement savings today means gaining control over your financial future and allowing yourself the freedom to turn your attention to your objectives—both for your retirement years and your Portland, OR business.
Types of Self-Employed Retirement Plans
Multiple retirement savings options open for self-employed individuals in Portland, OR, each providing its own pros and cons. A financial advisor is available to help you understand the benefits and drawbacks of each choice and identify the one most suitable for your unique situation. Typically, your self-employed retirement plan options in Portland, OR are:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent long-term savings plans that provide specific tax advantages. In a traditional IRA, you can usually deduct your contributions from taxable income, and investment earnings grow tax-deferred, but retirement distributions are taxed as income. In contrast, with Roth IRAs, you contribute using income already taxed, but qualified withdrawals in retirement, including earnings, are exempt from taxes. In both accounts, withdrawals are penalty-free as long as you are at least 59½.
Eligibility: Unlike plans linked to your job, both traditional and Roth IRAs are available to anyone with a source of income.
Contribution Limits: For 2025, annual contribution limits for IRAs are capped at $7,000, or $8,000 for those aged 50+.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: The Simplified Employee Pension IRA serves as a retirement savings option that allows entrepreneurs to contribute a percentage of their net earnings. Contributions can only be made by an employer, so, as a sole proprietor, you (the employee) are limited to contributions from the employer role beyond the 25% you (the employer) allocate. If you have employees, it's required to 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. SEP IRAs works well for entrepreneurs facing cycles of high revenue and low revenue. In contrast to some alternatives, SEP IRAs don’t have expensive setup or ongoing fees.
SEPs work like standard IRAs, where contributions are made with pre-tax money and retirement distributions are taxable.
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
For self-employed individuals, the amount eligible to be contributed is based on a special calculation.
Solo 401(k)
Plan Overview: The Solo 401(k), sometimes referred to as an Individual 401(k) or one-participant 401(k) plan, is a savings option for the self-employed intended for businesses with no employees or when the sole employee is your spouse. This type of plan function similarly to standard 401(k) plans, and enable contributions as both an employer and an employee with pre-tax money. This offers more savings compared to SEPs or IRAs; however, the extra savings options may be offset by 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 can set up 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:
- Employee contributions of up to 100% of your self-employment income, up to the annual contribution limit. In 2025, those limits are $23,500, or $31,000 if you're over 50, or $34,750 for individuals aged 60-63 in 2025.
- Employer profit-sharing contributions (as an employer) cannot exceed 25% of your net self-employment income, which is calculated as net profits less half of your self-employment tax and the employee contributions you made.
Your combined contributions must not surpass $70,000, or $77,500 for those aged 50 and older (as of 2025), $81,250 if you attain age 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: The defined benefit plan represents a type of retirement plan that delivers a set amount to business owners upon retirement. Unlike defined contribution plans mentioned above, this plan is not influenced by market performance, but allows self-employed individuals to know the precise amount they'll get in retirement. This plan is ideal for high-earning entrepreneurs who are focused on saving a large amount for retirement and can commit to making substantial contributions. Contributions grow tax-free until withdrawal, and withdrawals are taxed as income upon retirement.
Eligibility: Entrepreneurs running an owner-only business or with a small staff of under five may establish an individual defined benefit plan, but it's typically advised for those over 50 who make $250,000 or more annually. In most cases, good candidates for defined benefit plans include:
- Business owners or partners who aim to deposit more than $70,000 (or $77,500 for those aged 50+)
- Organizations that already put in 3-4% with plans to contribute more
- Companies that have demonstrated consistent profit patterns
- Business leaders over age 40 who wish to accelerate savings or accelerate the retirement savings
Contribution Limits: The cap on contributions requires calculation from an actuary using your financial situation, age, and savings targets. Limits on contributions are adjusted each year.
The Importance of a Financial Advisor in Portland, OR for Your Self-Employed Retirement Plan
Working with a financial advisor in Portland, OR experienced with retirement plans for the self-employed serves as an essential partner for those working for themselves. They have the expertise to help guide you through the challenges of retirement planning and craft a personalized approach that aligns with your goals. A financial advisor in Portland, OR will assess where you stand financially, identify your risk preferences, and guide you in making informed decisions about saving and investing for retirement. A key part of what we do for you involves:
- Assist in selecting a plan that best fits your needs and goals
- Customize the plan to your needs even further
- Create a written plan in accordance with IRS guidelines
- Arrange a trust plan for assets
- Make sure you understand the plan's terms
- Review and modify your plan when necessary
- Deliver continuous support and financial insights throughout your retirement planning process
- Increase your retirement income by making the most of your social security
Self-Employed Retirement Plans in Portland, OR: Correct Capital's Process
Portland, OR business owners who lack the time, interest, or knowledge to handle their retirement savings strategy on their own often feel overwhelmed when faced with their options. With Correct Capital, our Portland, OR financial advisors manage the lion's share of your retirement strategy for you, working to make meeting your retirement goals as easy as possible for you. We are here to assist you in setting up your self-employed retirement plan in four simple steps:
- 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 short conversation helps us get a sense of your goals with zero commitment or major time investment on your part.
- Gather Information: Should we agree to proceed, we'll gather information, including whether you have employees, your existing financial picture, and your long-term savings targets. This helps us create a tailored approach designed just for you.
- Review Your Plan: When we finalize a plan using the information you provide, we'll sit down with you and discuss your plan in detail to help you fully grasp it and understand how it best correlates to your needs.
- Implementation and Monitoring: Once we've agreed on your plan, we'll implement the necessary steps so you can begin contributing. As time goes on, we'll have regular meetings and monitor your plan to ensure it stays suited to your needs.
Our Portland, OR financial advisors and retirement plan consultants are fiduciary advisors, who are obligated to they are committed by law and ethics to prioritize your needs above all else.
Other financial advisory services we offer in Portland, OR include:
- 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
- Retirement Planner
Call Correct Capital for Your Self-Employed Retirement Plan in Portland, OR
To you, your business is more than "just a business", and your Portland, OR financial advisors must deliver more than basic financial recommendations. At Correct Capital, we make it a priority to understand our clients and their businesses to create personalized self-employed retirement plans. To every client in Portland, OR, we provide our I.O.U. promise: all guidance we provide will be independent, objective, and unbiased. To begin on your self-employment retirement plan, call Correct Capital today at 877-930-401k or contact us online.
