Self-employed retirement plans Reno, NV. The flexibility of owning your own business in Reno, NV is one of the best aspects of working for yourself. That said, this flexibility can come with potential drawbacks, particularly when it comes to planning for retirement, since you don't have access to a workplace retirement plan. Only 13% of self-employed individuals have a workplace retirement plan, yet countless could benefit from looking into other possibilities. In addition to achieving a more comfortable retirement, working with a financial advisor in Reno, NV to establish your self-employed retirement plan delivers significant tax advantages that allow your business to grow and succeed.
Few Reno, NV financial advisory and retirement planning firms understand the needs of self-employed individuals better than Correct Capital. Our founder's father was a small business owner himself (learn more about our story here), and Correct Capital are deeply experienced in supporting entrepreneurs with their retirement planning needs. We know that your business and retirement aspirations go far beyond just monetary concerns, and we are dedicated to provide personalized solutions that reflect your objectives. Read on to discover about your self-employed retirement plan options in Reno, NV, or give us a call at Correct Capital at 877-930-401k or contact us online to speak with a entrepreneurial financial advisor in Reno, NV today.
Why Reno, NV Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals are essential for preparing you for the future, they also provide immediate benefits today. From flexible contributions to considerable tax savings, working with a financial advisor in Reno, NV enables you to customize your retirement plan to fit 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 flexibility to modify how much you save:
- Customizable Contributions: Contribute more during high-income years and scale back when income is lower, so your plan aligns with your cash flow.
- Roth Options: Choosing a Roth Solo 401(k) lets you settle taxes at the time of contribution, enabling you to withdraw tax-free later—a wise move if you believe your tax rate is likely to rise in the future.
Save Money on Taxes
Retirement plans for self-employed individuals provide valuable tax benefits:
- Tax-Deductible Contributions: Contributions to a SIMPLE IRA shrink your tax liability, so you can keep more of your earnings.
- Tax-Deferred Growth: Investments grow tax-free until withdrawal, providing your money more time to grow.
- State-Specific Incentives: Based on your location, you could qualify for extra deductions as a sole proprietor. These state-level incentives help make these plans even more valuable.
- Retirement Savings Contributions Credit (Saver’s Credit): Those who meet the requirements can apply for a credit of up to 50% of the first $2,000 contributed a retirement plan, cutting down 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 about how you invest:
- Diversified Portfolios: Spreading your investments across different asset classes like stocks and bonds can help reduce risk while continuing to build your retirement fund.
- Emergency Back-Up: Supplementing your retirement savings with a financial buffer for your business helps you avoid tapping into your nest egg during financial hardships and facing tax penalties.
Plan for the Future of Your Reno, NV Business
Preparing for retirement also helps you prepare for what’s next with your Reno, NV business:
- Selling Your Business: If you’re planning to sell, plans like SEP IRAs or Solo 401(k)s remain yours and don’t transfer with the business. These plans offer the steady income you’ll need during retirement. Keep in mind that while selling your business results in a capital gain, retirement plan contributions are subject to yearly maximums (e.g., up to $7,000 for IRAs or up to $70,000 for Solo 401(k)s, factoring in catch-up contributions, based on plan compensation).
- Minimizing Taxes: Making the most of retirement savings minimizes the taxes you might face when you sell your business.
- Succession Planning: Whether you’re transferring ownership, your retirement accounts offer a stable foundation during the change. You may also work with a financial advisor experienced in both succession and retirement strategies to minimize tax burdens associated with the transaction.
With the best-fit retirement strategy, you gain control over your financial future, lower your tax bill, and establish a solid base for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Reno, NV Now?
Time remains one of the most crucial factors in retirement planning. Starting early not only helps you grow a more substantial retirement fund but also minimizes the pressure of catching up later in life. The following are reasons why it makes sense to begin today:
The Cost of Waiting
Delaying your retirement savings 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, subsequently, generate even more returns. The longer your money has to grow, the larger the effect of compounding.
Example: Two individuals, Alex and Taylor are both self-employed individuals. Both of them want to save $500,000 for retirement by age 65:
- Alex begins contributing $5,000 annually at age 30.
- Taylor waits until age 40 but contributes $7,500 annually to catch up.
By age 65, with an assumption of 7% annual return:
- Alex puts in $180,000 and accumulates $691,184.39*.
- Taylor puts in $195,500 but achieves a total of only $474,367.78*.
How Early Contributions Grow
Regular, modest investments invested steadily can lead to significant growth. Here’s a simple scenario showing the power of compounding:
- Starting at age 25: If you invest $200 per month in a retirement plan with an average annual return of 7%, you’ll grow to approximately $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 gap of over $260,000, just from a 10-year delay.
The earlier you begin, the less effort required each year to achieve your retirement goals.
*The figures provided in this example are based on 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. This information is for illustrative purposes only and are not a promise of future results. Your individual results may differ depending on variables including market conditions, fees, and your unique situation. We recommend consulting a financial advisor for personalized advice.
Take Control of Your Financial Future
As a self-employed person in Reno, NV, it can be tempting to put more emphasis on reinvesting in your business instead of saving for retirement. That said, beginning a plan now allows you to:
- Leverage growth that is tax-deferred or penalty-free withdrawals down the road.
- Take advantage of adjustable savings that adapt to your cash flow.
- Establish a long-term safety measure that offers peace of mind, no matter how your business evolves.
Starting early, the less you’ll need to worry about playing catch-up later in life. Building your retirement savings today means managing your financial future and allowing yourself the ability to concentrate on your goals—both for your retirement years and your Reno, NV business.
Types of Self-Employed Retirement Plans
A variety of retirement savings options open for entrepreneurs in Reno, NV, each with its own benefits and trade-offs. A financial advisor is available to help you understand the advantages and disadvantages of each plan and choose the one ideal for your unique situation. Generally speaking, your self-employed retirement plan options in Reno, NV are:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent retirement savings vehicles that include distinct tax benefits. In a conventional IRA, the money you contribute is often tax-deductible, and investment earnings grow tax-deferred, but retirement distributions are taxed as income. In contrast, Roth IRA contributions are made with after-tax income, but qualified withdrawals in retirement, including earnings, are not taxed. In both accounts, withdrawals come without penalties if you are at least 59½.
Eligibility: While many retirement plans, such as 401(k)s, are tied to employment, both traditional and Roth IRAs 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 offers a way to save for retirement that permits those who are self-employed to set aside a portion of their self-employment income. 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) have designated. If you have employees, you must contribute the same amount for them as you do for yourself. You have the flexibility to contribute a flat-dollar amount or a percentage of wages to employee accounts. A SEP IRA may be ideal for businesses that experience fluctuating revenue streams. Unlike other plans, SEP IRAs lack costly startup or administrative fees.
SEPs operate like traditional IRAs, where the contributions are tax-deferred and withdrawals are taxed as income.
Eligibility: Employers of any type, including 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: Solo 401(k)s, sometimes referred to 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. These plans operate much like traditional employer-managed 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 additional opportunities can be balanced by more restricted investment choices. Using a solo 401(k), 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 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. In 2025, those limits are $23,500, or $31,000 if you're over 50, or $34,750 for those who turn 60-63 in 2025.
- Contributions as an employer (as an employer) are limited to 25% of your adjusted self-employment income, which is defined as net profit minus half of your self-employment tax and the employee contributions you made.
Total contributions are capped at $70,000, or $77,500 if you're over age 50 (in 2025), $81,250 if you attain age 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: A defined benefit plan is a retirement option that guarantees a set amount to entrepreneurs upon retirement. Unlike defined contribution plans mentioned above, this plan is not influenced by market performance, but allows self-employed individuals to know what they'll have in retirement. This plan is ideal for higher-income self-employed individuals who aim to accumulate a significant sum for retirement and can commit to making larger deposits. Contributions are tax deferred, and withdrawals are taxable as income upon retirement.
Eligibility: Any self-employed individual running an owner-only business or with a small staff of under five can open an individual defined benefit plan, but it's generally suggested for people above age 50 who generate a minimum of $250,000 yearly. Typically, good candidates for defined benefit plans include:
- Business owners or partners who aim to deposit more than $70,000 (or $77,500 if over age 50)
- Businesses currently investing 3-4% and are willing to do more
- Companies showing consistent profit patterns
- Partners or owners over age 40 who desire to "catch up" or boost savings within a short timeframe
Contribution Limits: The cap on contributions is calculated by an actuary using your income, age, and retirement goals. Contribution limits are adjusted each year.
The Importance of a Financial Advisor in Reno, NV for Your Self-Employed Retirement Plan
Working with a financial advisor in Reno, NV experienced with retirement plans for the self-employed is an important asset for self-employed individuals. They have the expertise to help guide you through the challenges of retirement planning and develop a personalized approach that reflects your aspirations. An expert in your area will evaluate your financial situation, determine how much risk you’re comfortable with, and help you in making informed decisions about saving and investing for retirement. A key part of what we do for you involves:
- Guide you in choosing a plan that best fits your needs and goals
- Further adapt the plan to your specific situation even further
- Create a written plan in accordance with IRS guidelines
- Set up an asset trust plan
- Make sure you understand the plan's terms
- Monitor and adjust your plan when necessary
- Deliver continuous support and financial insights as you continue on the road to retirement
- Increase your retirement income by optimizing your social security benefits
Self-Employed Retirement Plans in Reno, NV: Correct Capital's Process
Self-employed individuals in Reno, NV who lack the time, interest, or knowledge to handle their own retirement planning independently may end up overwhelmed when faced with their options. With Correct Capital, our Reno, NV financial advisors take on the majority of your savings plan setup for you, working to make meeting your financial objectives as straightforward as possible for you. We can help you get set 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 our services align for you and your business. This initial call helps us get a sense of your goals with zero commitment or significant effort on your part.
- Gather Information: If we both decide to move forward, we'll gather information, including your employee count, your present financial standing, and your future objectives. This allows us to put together a custom plan suited specifically for your needs.
- Review Your Plan: Once we've developed a plan based on the information you provide, we'll meet with you and go over your plan in detail to help you fully grasp it and explain its fit to your circumstances.
- Implementation and Monitoring: When we finalize on your plan, we'll set everything up so you can initiate your savings journey. Over the course of our partnership, we'll check in and monitor your plan to ensure it stays suited to your needs.
Our Reno, NV financial advisors and retirement plan consultants are fiduciary advisors, who are obligated to they are required by law and ethical standards to act in your best interest.
Other financial advisory services we offer in Reno, NV include:
- Financial Planning for Business Owners
- 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
Call Correct Capital for Your Self-Employed Retirement Plan in Reno, NV
Your business isn't "just a business" to you, and your Reno, NV financial advisors must deliver more than just good financial guidance. At Correct Capital, we take the time to get to know our clients and their businesses to provide customized self-employed retirement plans. We offer all our Reno, NV clients 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, reach out to Correct Capital at 877-930-401k or contact us online.
