Self-employed retirement plans Tallahassee, FL. The freedom of owning your own business in Tallahassee, FL offers many benefits of being self-employed. That said, this flexibility can come with a lack of security, notably in terms of planning for retirement, because you don't have the benefit of a workplace retirement plan. Only 13% of self-employed individuals have a workplace retirement plan, but many would be better off looking into other possibilities. In addition to achieving a financially stable retirement, partnering with a financial advisor in Tallahassee, FL to establish your self-employed retirement plan can provide significant tax advantages that allow you to move your business forward.
Few Tallahassee, FL financial advisory and retirement planning firms are as attuned to the requirements of small business owners better than Correct Capital. The father of our founder was a small business owner himself (learn more about our story here), and we take pride in helping businesses with their retirement planning needs. We understand that your goals for your business and retirement extend well past simple financial figures, and we work tirelessly to provide personalized solutions to meet your unique goals. Continue exploring to find out about your self-employed retirement plan options in Tallahassee, FL, or call Correct Capital at 877-930-401k or contact us online to talk to a self-employed financial advisor in Tallahassee, FL today.
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Why Tallahassee, FL Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals are essential for preparing you for the future, they also deliver immediate benefits today. Offering flexibility in contributions to significant tax savings, working with a financial advisor in Tallahassee, FL helps you create your retirement plan to suit your specific needs.
Flexibility That Fits Your Income
If your income changes from year to year, a plan like a SEP IRA or Solo 401(k) offers the flexibility to tailor how much you save:
- Customizable Contributions: Contribute more during profitable years and cut back when your earnings dip, so that your plan works with your financial situation.
- Roth Options: Choosing a Roth Solo 401(k) lets you handle taxes upfront, so you can withdraw your savings tax-free down the road—an advantageous choice if you anticipate your tax rate is likely to rise in the future.
Save Money on Taxes
Self-employed retirement plans provide valuable tax benefits:
- Tax-Deductible Contributions: Contributions to a SEP IRA lower your taxable income, so you can keep more of your hard-earned money.
- Tax-Deferred Growth: You won't pay taxes on investment growth until you withdraw it, providing your money more time to accumulate.
- State-Specific Incentives: Depending on where you live, you may be eligible for additional deductions as a sole proprietor. These regional incentives make these plans even more beneficial.
- 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, further reducing 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 varied asset classes like stocks and bonds serves to reduce risk while still growing your savings.
- Emergency Back-Up: Supplementing your retirement savings with a dedicated business safety net prevents you from dipping into savings during financial hardships and risking extra costs.
Plan for the Future of Your Tallahassee, FL Business
Preparing for retirement can assist you plan ahead for what’s next with your Tallahassee, FL business:
- Selling Your Business: For those considering a sale, accounts such as SEP IRAs or Solo 401(k)s stay in your name and won’t be included in the sale. These plans offer the steady income you’ll need in the future. It’s important to note that while selling a business often leads to a capital gain, deposits into these plans are capped at annual limits (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: Strategically planning your contributions can reduce the taxes you are required to pay when you sell your business.
- Succession Planning: Whether you’re transferring ownership, your nest egg provide financial security as you make this shift. You can also partner with a financial advisor with expertise in succession and retirement planning to help with taxes during the sale.
With the proper savings strategy, you can take control of 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 Tallahassee, FL Now?
There’s no denying that time is one of the most important assets when it comes to saving for retirement. Getting a head start not only helps you grow a bigger financial cushion but also lowers the financial burden of playing catch-up as you get older. The following are reasons why it pays to take action now:
The Cost of Waiting
Waiting to start your retirement fund may cause a substantial impact on the total you’ll have when you stop working. The biggest reason is compound interest—the powerful process where your investments generate earnings, and those returns, then, generate even more returns. The longer your money has to grow, the greater the effect of compounding.
Example: 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 delays savings until age 40 but saves $7,500 annually to bridge the gap.
By age 65, using a projected 7% annual return:
- Alex invests $180,000 and accumulates $691,184.39*.
- Taylor contributes $195,500 but accumulates just $474,367.78*.
How Early Contributions Grow
Even modest contributions made consistently often create impressive growth. Here’s a simple scenario showing the power of consistent growth:
- Starting at age 25: By investing $200 per month in a retirement plan with an expected yearly growth rate of 7%, you’ll end up with $497,303.29* by age 65.
- Starting at age 35: Investing the same $200 per month would result in only $235,412.97* by age 65—a gap of over $260,000, all because of a 10-year delay.
Saving early, the less effort required each year to reach your retirement goals.
*The numbers shown in this scenario are based on estimates derived from NerdWallet’s Compound Interest Calculator, based on a 7% annual return. The contributions were calculated by multiplying the annual deposit amount by the total number of years contributions were made. These examples are for illustrative purposes only and do not guarantee future performance. Actual results may vary based on elements like 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 Tallahassee, FL, it might seem easier to put more emphasis on reinvesting in your business rather than saving for retirement. That said, beginning a plan now gives you the chance to:
- Benefit from tax-deferred growth or withdrawals without taxes later on.
- Benefit from contribution flexibility that change with your earnings.
- Establish a financial cushion that ensures stability, no matter how your business changes.
Getting started now, the less you’ll need to worry about playing catch-up later in life. Taking steps toward your retirement goals today means taking control of your financial future and allowing yourself the opportunity to turn your attention to your dreams—both for your golden years and your Tallahassee, FL business.
Types of Self-Employed Retirement Plans
A variety of retirement savings options available for self-employed individuals in Tallahassee, FL, each offering its own advantages and considerations. A financial advisor will guide you to learn about the advantages and disadvantages of each choice and identify the one ideal for your needs. In most cases, your self-employed retirement plan options in Tallahassee, FL include:
Traditional or Roth IRA
Plan Overview: IRAs, or Individual Retirement Accounts, are financial tools for retirement that offer key tax perks. In a standard IRA, you can usually deduct your contributions from taxable income, and investment earnings grow tax-deferred, but money taken out during retirement are taxed as income. In contrast, Roth IRA contributions from post-tax earnings, but eligible distributions during retirement, including earnings, are exempt from taxes. In both types of accounts, withdrawals are penalty-free if you are at least 59½.
Eligibility: Unlike 401(k)s, which are employer-sponsored, traditional and Roth IRAs are available to anyone with an earned income.
Contribution Limits: For 2025, annual contribution limits for IRAs are set at $7,000, or $8,000 for those aged 50+.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: SEP IRAs serves as a retirement savings option that enables self-employed individuals to set aside a portion of their self-employment income. Contributions must come from an employer, so, as a self-employed individual, you (the employee) would not be able to contribute beyond the 25% you (the employer) have designated. 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. SEP IRAs may be ideal for businesses that experience fluctuating revenue streams. In contrast to some alternatives, SEP IRAs are free of expensive setup or ongoing fees.
SEPs operate like standard IRAs, where you contribute pre-tax dollars and retirement distributions are taxable.
Eligibility: Any employer, including the self-employed 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
If you’re self-employed, the contribution you can make is based on a special calculation.
Solo 401(k)
Plan Overview: A Solo 401(k) plan, sometimes referred to as an Individual 401(k) or one-participant 401(k) plan, is a self-employed retirement plan designed for companies that have no employees or if the only employee is your spouse. These plans are similar to standard 401(k) plans, and let you make contributions as both the employer and the employee with pre-tax money. This allows for more savings compared to SEPs or IRAs; however, the additional opportunities often come with more limited investment options. 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: This plan is exclusively for business owners and their spouses are eligible to open and contribute to a solo 401(k).
Contribution Limits: As a self-employed individual with a solo 401(k) plan, you are allowed to make two types of contributions:
- Employee contributions of up to 100% of your self-employed earnings, 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 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 employee contributions you made.
Total contributions are capped at $70,000, or $77,500 if you're over age 50 (as of 2025), $81,250 if you attain age 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: Defined benefit plans offers a structured retirement solution that provides a pre-established payout to business owners upon retirement. In contrast to the plans discussed earlier, this plan is not influenced by market performance, but enables participants to determine what they'll get in retirement. This option is best suited for high-earning professionals who aim to accumulate a significant sum for retirement and are willing to make substantial contributions. Contributions are tax deferred, and withdrawals are taxable as income during retirement.
Eligibility: Any self-employed individual operating a solo business or with less than five employees are eligible to open an individual defined benefit plan, but it's most commonly advised for individuals aged 50+ who generate a minimum of $250,000 yearly. In most cases, good candidates for defined benefit plans include:
- Partners or owners who want to invest 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
- Business leaders over age 40 who wish to accelerate savings or accelerate the retirement savings
Contribution Limits: The cap on contributions is calculated by an actuary based on your financial situation, age, and savings targets. Allowable contributions are adjusted each year.
The Importance of a Financial Advisor in Tallahassee, FL for Your Self-Employed Retirement Plan
Partnering with an advisor in Tallahassee, FL specialized in self-employed retirement plans can be an important asset for self-employed individuals. They offer the knowledge to assist guide you through the challenges of retirement planning and develop a customized plan that reflects your aspirations. An expert in your area will evaluate your financial situation, identify your risk preferences, and help you in choosing wisely about saving and investing for retirement. Part of what we do for you features:
- Guide you in choosing a plan that suits your unique requirements
- Customize the plan to your needs even further
- Create a written plan in accordance with IRS guidelines
- Organize a trust plan to manage your assets
- Help you understand the plan's terms
- Monitor and adjust your plan as needed
- Provide ongoing education and advice to help you navigate your retirement journey
- Increase your retirement income by making the most of your social security
Self-Employed Retirement Plans in Tallahassee, FL: Correct Capital's Process
Tallahassee, FL business owners who don’t have the time or expertise to manage their self-employed retirement plan on their own often feel overwhelmed when faced with their options. Through our team at Correct Capital, our Tallahassee, FL financial advisors handle the majority of your retirement strategy for you, working to make meeting your retirement goals as easy as possible for you. We will guide you in creating 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 we're suited to your needs for you and your business. This short conversation helps us learn about your needs with zero commitment or major time investment on your part.
- Gather Information: Should we agree to proceed, we'll gather information, including how many employees you have (if any), your present financial standing, and your retirement goals. This allows us to put together a personalized strategy designed just for you.
- Review Your Plan: Once we've developed a plan from the information you provide, we'll sit down with you and discuss 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. Throughout our relationship, we'll have regular meetings and monitor your plan to ensure it stays suited to your needs.
Our Tallahassee, FL financial advisors and retirement plan consultants act as fiduciary advisors, meaning they are required by law and ethical standards to act in your best interest.
Other financial advisory services we offer in Tallahassee, FL include:
- 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 Tallahassee, FL
Your business isn't "just a business" to you, and your Tallahassee, FL financial advisors need to offer more than basic financial recommendations. With Correct Capital, we make it a priority to understand our clients and their businesses to create customized self-employed retirement plans. All our clients in Tallahassee, FL benefit from our I.O.U. promise: all guidance we provide will be independent, objective, and unbiased. To get started on your self-employment retirement plan, call Correct Capital today at 877-930-401k or contact us online.
