Self-employed retirement plans San Antonio, TX. The freedom of running your own company in San Antonio, TX is one of the best aspects of being self-employed. Even so, this freedom often comes with a lack of security, particularly when it comes to planning for retirement, because you don't have access to 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 enjoying a financially stable retirement, working with a financial advisor in San Antonio, TX to establish your self-employed retirement plan offers significant tax advantages that enable your business to grow and succeed.
Few San Antonio, TX financial advisory and retirement planning firms are as attuned to the requirements 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 have a rich history of assisting business owners in their retirement planning needs. We recognize that your business and retirement aspirations aren’t limited to basic numbers, and we work tirelessly to create tailored solutions that reflect your objectives. Continue exploring to find out about your self-employed retirement plan options in San Antonio, TX, or give us a call at Correct Capital at 877-930-401k or contact us online to talk to a self-employed financial advisor in San Antonio, TX today.
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Why San Antonio, TX Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals are essential for preparing you for the future, they also offer real benefits today. With customizable contribution options to significant tax savings, consulting a financial advisor in San Antonio, TX allows you to create your retirement plan to align with your specific needs.
Flexibility That Fits Your Income
For those with fluctuating income annually, a plan like a SEP IRA or Solo 401(k) gives you the freedom to tailor how much you save:
- Customizable Contributions: Contribute more during profitable years and reduce savings when your earnings dip, ensuring your plan aligns with your cash flow.
- Roth Options: Choosing a Roth Solo 401(k) lets you pay taxes on contributions now, so you can withdraw without tax penalties in the future—a wise move if you anticipate your tax rate to be higher in the future.
Save Money on Taxes
Plans designed for the self-employed offer valuable tax benefits:
- Tax-Deductible Contributions: Contributions to a Solo 401(k) shrink your tax liability, allowing you to keep more of your earnings.
- Tax-Deferred Growth: Investments grow tax-free until withdrawal, giving your money more time to compound.
- State-Specific Incentives: In some states, you might access additional deductions as a business owner. 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 put into a retirement plan, further reducing 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: Spreading your investments across different stocks, bonds, and other assets serves to reduce risk while still growing your savings.
- Emergency Back-Up: Supplementing your retirement savings with a financial buffer for your business prevents you from using your retirement funds during tough times and risking extra costs.
Plan for the Future of Your San Antonio, TX Business
Preparing for retirement enables you to think through what’s next with your San Antonio, TX business:
- Selling Your Business: For those considering a sale, plans like SEP IRAs or Solo 401(k)s remain your personal assets and are not part of the sale. These plans can provide the financial stability you’ll need in the future. Remember that while the sale of a business usually creates a capital gain, contributions to retirement accounts are subject to yearly maximums (e.g., up to $7,000 for IRAs or as much as $70,000 for Solo 401(k)s, with catch-up contributions, according to plan rules).
- Minimizing Taxes: Using retirement contributions wisely helps lower the taxes you are required to pay when you pass on your business.
- Succession Planning: For those winding down or handing over their business, your retirement accounts ensure a stable foundation through the transition. You might want to work with a financial advisor who specializes in succession planning and retirement accounts to help with taxes during the sale.
With the best-fit retirement strategy, you manage your financial future, cut down your tax obligations, and establish a secure foundation for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in San Antonio, TX Now?
Time is one of the most valuable factors for building your retirement fund. Getting a head start not only allows you to build a larger nest egg but also minimizes the pressure of catching up later in life. The following are reasons why it pays to take action now:
The Cost of Waiting
Delaying your retirement savings can have a substantial impact on the savings you’ll have when you stop working. The biggest reason is compound interest—the financial principle where your investments generate earnings, and those returns, then, earn even more returns. The more time your money has to grow, the greater the benefit of this compounding process.
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 waits 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 ends up with $691,184.39*.
- Taylor invests $195,500 but accumulates just $474,367.78*.
How Early Contributions Grow
Regular, modest investments made consistently may result in significant growth. Consider this example showing the impact of consistent growth:
- 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 leaves you with only $235,412.97* by age 65—a gap of over $260,000, simply due to a 10-year delay.
Saving early, the lower your annual savings needs each year to reach your retirement goals.
*These calculations are based on estimates generated with NerdWallet’s Compound Interest Calculator, assuming a 7% annual return. The contributions were calculated by multiplying the annual deposit amount by the total number of years contributions were made. This information is intended as illustrative examples and are not a promise of future results. Your individual results may differ depending on variables including market conditions, fees, and personal factors. Always consult a financial advisor for guidance tailored to your needs.
Take Control of Your Financial Future
If you’re self-employed in San Antonio, TX, it can be tempting to prioritize reinvesting in your business rather than saving for retirement. Even so, beginning a plan now gives you the chance to:
- Leverage growth that is tax-deferred or tax-free withdrawals in the future.
- Benefit from adjustable savings that align with your earnings.
- Build a safety net that ensures stability, no matter how your business evolves.
Starting early, the less you’ll need to worry about making up for lost time later in life. Taking steps toward your retirement goals today means taking control of your financial future and giving yourself the opportunity to focus on your objectives—both for your golden years and your San Antonio, TX business.
Types of Self-Employed Retirement Plans
Multiple retirement savings options open for those working for themselves in San Antonio, TX, each providing its own advantages and considerations. A financial advisor will guide you to understand the advantages and disadvantages of each choice and determine the one most suitable for your circumstances. Generally speaking, your self-employed retirement plan options in San Antonio, TX are:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent retirement savings vehicles that offer key tax perks. In a conventional IRA, contributions are typically 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 eligible distributions during retirement, including earnings, are exempt from taxes. In both cases, withdrawals come without penalties if you are at least 59½.
Eligibility: Unlike 401(k)s, which are employer-sponsored, both traditional and Roth IRAs are accessible for individuals with a source of income.
Contribution Limits: For 2025, annual contribution limits for IRAs are set at $7,000, or $8,000 if you qualify for catch-up contributions.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: SEP IRAs offers a way to save for retirement that enables 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) are limited to contributions from the employer role beyond the 25% you (the employer) allocate. If you have employees, you must contribute the same amount for them as you do for yourself. You may choose to contribute a set monetary value or a percentage of wages to employee accounts. SEP IRAs works well for companies with fluctuating revenue streams. Compared to other retirement options, SEP IRAs are free of the high fees associated with starting or maintaining other plans.
SEPs work like standard IRAs, where contributions are made with pre-tax money and money withdrawn is subject to income tax.
Eligibility: Any employer, including the self-employed can establish 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 allowable contribution is based on a special calculation.
Solo 401(k)
Plan Overview: A Solo 401(k) plan, also called an Individual 401(k) or one-participant 401(k) plan, is a self-employed retirement plan meant for companies that have no employees or where the only employee is a spouse. These plans are similar to standard 401(k) plans, and enable contributions as both the employer and the employee with pre-tax money. This allows for more savings versus SEPs or IRAs; however, the increased savings potential can be balanced by more limited investment options. Using a solo 401(k), you can make either traditional or Roth deferrals, which share 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 are allowed to make two types of contributions:
- Elective deferrals (as an employee) of up to 100% of your self-employed earnings, subject to the annual contribution limit. For 2025, the limits will be $23,500, or $31,000 if you are 50 or older, or $34,750 for those who turn 60-63 in 2025.
- Employer profit-sharing contributions (as an employer) must not surpass 25% of your net earnings from self-employment, which is defined as net profit minus half of your self-employment tax and the employee contributions you made.
The total contribution cannot exceed $70,000, or $77,500 for those aged 50 and older (as of 2025), $81,250 for individuals turning 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: The defined benefit plan represents a type of retirement plan that provides a pre-established payout to business owners upon retirement. In contrast to the plans discussed earlier, a defined benefit plan doesn't fluctuate based on investment returns, but allows self-employed individuals to know exactly how much they'll receive in retirement. This option is best suited for higher-income entrepreneurs who want to save a significant sum for retirement and are prepared to contribute sizeable contributions. Contributions offer tax-deferred growth, and withdrawals incur taxes as income in retirement.
Eligibility: Entrepreneurs running an owner-only business or with less than five employees are eligible to open an individual defined benefit plan, but it's generally recommended for people above age 50 who generate a minimum of $250,000 yearly. Generally, good candidates for defined benefit plans include:
- Business owners or partners who want to invest more than $70,000 (or $77,500 if over age 50)
- Companies already contributing 3-4% but are open to increasing contributions
- Organizations with proven consistent profit patterns
- Partners or owners over age 40 who aim to quickly build retirement savings or accelerate the retirement savings
Contribution Limits: The cap on contributions is calculated by an actuary using your financial situation, age, and savings targets. Allowable contributions change annually.
The Importance of a Financial Advisor in San Antonio, TX for Your Self-Employed Retirement Plan
A financial advisor in San Antonio, TX specialized in self-employed retirement plans serves as an essential partner for self-employed individuals. They bring the skills needed to guide you through the challenges of retirement planning and craft a customized plan that aligns with your goals. Your advisor in San Antonio, TX will review your finances, identify your risk preferences, and help you in selecting the best options about saving and investing for retirement. Included in what we do for you features:
- Guide you in choosing a plan that suits your unique requirements
- Customize 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
- Ensure you comprehend the plan's terms
- Track and fine-tune your plan to keep it aligned with your goals
- Provide ongoing education and advice throughout your retirement planning process
- Increase your retirement income by optimizing your social security benefits
Self-Employed Retirement Plans in San Antonio, TX: Correct Capital's Process
Self-employed individuals in San Antonio, TX who lack the time, interest, or knowledge to manage their own retirement planning independently often feel overwhelmed when faced with their available plans. At Correct Capital, our San Antonio, TX financial advisors manage the majority of your savings plan setup for you, to help 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 can determine if our services align for you and your business. This initial call helps us understand what you're looking for with zero commitment or extensive time commitment on your part.
- Gather Information: If we both decide to move forward, we'll ask for information, including your employee count, your existing financial picture, and your retirement goals. 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 schedule a meeting and go over your plan thoroughly to help you fully grasp it and understand how it best correlates to your needs.
- Implementation and Monitoring: When we finalize on your plan, we'll set everything up so you can begin contributing. As time goes on, we'll have regular meetings and track your progress to ensure it stays suited to your needs.
Our San Antonio, TX financial advisors and retirement plan consultants act as fiduciary advisors, who are obligated to they are committed by law and ethics to do what's in your best interest.
Other financial advisory services we offer in San Antonio, TX 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 San Antonio, TX
You don't see your business as "just a business", and your San Antonio, TX financial advisors must deliver more than just good financial guidance. Correct Capital takes pride in, we take the time to get to know our clients and their businesses to create customized self-employed retirement plans. All our clients in San Antonio, TX benefit from our I.O.U. promise: everything we recommend will be independent, objective, and unbiased. To take the first step on your self-employment retirement plan, reach out to Correct Capital at 877-930-401k or contact us online.
