Self-employed retirement plans Tallahassee, FL. The freedom of running your own company in Tallahassee, FL offers many benefits of working for yourself. That said, this freedom often comes with potential drawbacks, particularly in terms of retirement savings, because you don't have the benefit of retirement programs through an employer. Only 13% of self-employed individuals have a workplace retirement plan, although many should consider exploring their options. In addition to having a more comfortable retirement, partnering with a financial advisor in Tallahassee, FL to establish your self-employed retirement plan offers significant tax advantages that enable both you and your business to thrive.
Few Tallahassee, FL investment consulting and retirement planning firms truly grasp the challenges faced by entrepreneurs better than Correct Capital. The father of our founder was a small business owner himself (learn more about our story here), and Correct Capital take pride in helping businesses with their retirement planning needs. We know that your professional and personal aspirations aren’t limited to basic numbers, and we work tirelessly to offer customized solutions aligned with your vision. Keep reading to learn more about your self-employed retirement plan options in Tallahassee, FL, or give us a call at Correct Capital at 877-930-401k or contact us online to talk to a small business financial advisor in Tallahassee, FL today.
Why Tallahassee, FL Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals help prepare you for the future, they also deliver real benefits today. With customizable contribution options to substantial tax savings, working with a financial advisor in Tallahassee, FL helps you design your retirement plan to fit your specific needs.
Flexibility That Fits Your Income
If your income changes annually, a plan like a SEP IRA or Solo 401(k) offers the freedom to tailor how much you save:
- Customizable Contributions: Contribute more during profitable years and cut back when your earnings dip, ensuring your plan aligns with your financial situation.
- Roth Options: Choosing a Roth Solo 401(k) lets you handle taxes upfront, so you can withdraw without tax penalties in the future—a smart decision if you anticipate your tax rate to be higher in the future.
Save Money on Taxes
Self-employed retirement plans provide powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a SIMPLE IRA reduce what you owe in taxes, helping you keep more of your hard-earned money.
- Tax-Deferred Growth: Investments grow tax-free until withdrawal, which gives your money more time to grow.
- State-Specific Incentives: Depending on where you live, you may be eligible for state-specific credits as a self-employed individual. These local incentives make these plans even more beneficial.
- 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
Planning for a safe retirement isn’t only about how much you save—it’s also determined by your investment strategy:
- Diversified Portfolios: Allocating your investments across a mix of asset classes like stocks and bonds can help minimize exposure to risk while helping to grow your retirement fund.
- Emergency Back-Up: Supplementing your retirement savings with a business emergency fund prevents you from tapping into your nest egg during challenging periods and facing tax penalties.
Plan for the Future of Your Tallahassee, FL Business
Retirement planning also helps you prepare for what’s next with your Tallahassee, FL business:
- Selling Your Business: If you’re planning to sell, accounts such as SEP IRAs or Solo 401(k)s stay in your name and don’t transfer with the business. These accounts offer the steady income you’ll need in the future. It’s important to note that while selling your business results in a capital gain, deposits into these plans are restricted by contribution 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, according to plan rules).
- Minimizing Taxes: Strategically planning your contributions minimizes the taxes you are required to pay when you pass on your business.
- Succession Planning: Whether you’re transferring ownership, your retirement savings provide the funds you need through the transition. You might want to partner with a financial advisor who specializes in succession planning and retirement accounts to reduce taxes associated with the transaction.
With the proper savings strategy, you gain control over your financial future, lower your tax bill, and create a solid base for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Tallahassee, FL Now?
Time remains one of the most important assets for building your retirement fund. Starting early not only helps you grow a bigger financial cushion but also minimizes the financial burden of saving aggressively in the future. The following are reasons why it pays to take action now:
The Cost of Waiting
Delaying your retirement savings may cause a major impact on the total you’ll have when you retire. The biggest reason is compound interest—the powerful process where your investments earn returns, and those returns, then, accumulate even more returns. The more time your money has to grow, the greater the effect of this compounding process.
Example: Two individuals, Alex and Taylor are both self-employed professionals. Both of them want to save $500,000 for retirement by age 65:
- Alex initiates savings of $5,000 annually at age 30.
- Taylor waits until age 40 but saves $7,500 annually to bridge the gap.
By age 65, assuming 7% annual return:
- Alex invests $180,000 and accumulates $691,184.39*.
- Taylor invests $195,500 but achieves a total of only $474,367.78*.
How Early Contributions Grow
Regular, modest investments invested steadily often create impressive growth. Consider this example showing the power of consistent growth:
- Starting at age 25: By investing $200 per month in a retirement plan with an projected return of 7%, you’ll grow to approximately $497,303.29* by age 65.
- Starting at age 35: Saving the same $200 per month leaves you with only $235,412.97* by age 65—a shortfall of over $260,000, all because of a 10-year delay.
The earlier you begin, the less you need to save each year to meet your retirement goals.
*The figures provided in this example represent estimates generated with NerdWallet’s Compound Interest Calculator, assuming a 7% annual return. Annual deposits were multiplied by the number of years to estimate total contributions. These examples are meant to provide general guidance and are not a promise of future results. Your individual results may differ based on elements like 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 Tallahassee, FL, it is often the case that you prioritize reinvesting in your business rather than saving for retirement. That said, initiating a plan now allows you to:
- Benefit from tax-deferred growth or tax-free withdrawals down the road.
- Enjoy flexible contributions that change with your income.
- Build a long-term safety measure that ensures stability, no matter how your business changes.
Starting early, the less you’ll be required to worry about making up for lost time later in life. Saving for retirement now means gaining control over your financial future and allowing yourself the freedom to concentrate on your objectives—both for your retirement years and your Tallahassee, FL business.
Types of Self-Employed Retirement Plans
There are several retirement savings options available for those working for themselves in Tallahassee, FL, each offering its own benefits and trade-offs. A financial advisor is available to help you evaluate the benefits and drawbacks of each option and choose the one best suited for your needs. Generally speaking, your self-employed retirement plan options in Tallahassee, FL are:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent long-term savings plans that provide distinct tax benefits. In a standard IRA, the money you contribute is often tax-deductible, and returns grow free of current taxes, but retirement distributions are subject to income tax. In contrast, with Roth IRAs, you contribute are made with after-tax income, but retirement withdrawals that qualify, including earnings, are not taxed. In both accounts, withdrawals come without penalties as long as you are at least 59½.
Eligibility: Unlike 401(k)s, which are employer-sponsored, traditional and Roth IRAs are open to those with taxable earnings.
Contribution Limits: For 2025, annual contribution limits for IRAs are capped at $7,000, or $8,000 if you're 50 or older.
Simplified Employee Pension Plan (SEP IRA)
Plan Overview: A Simplified Employee Pension (SEP) IRA offers a way to save for retirement 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) cannot make additional contributions beyond the 25% you (the employer) already contributed. 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 set monetary value or a percentage of wages to employee accounts. This type of plan works well for companies with periods of inconsistent earnings. In contrast to some alternatives, SEP IRAs are free of expensive setup or ongoing fees.
SEPs operate like traditional IRAs, where you contribute pre-tax dollars and retirement distributions are taxable.
Eligibility: Employers of any type, including self-employed individuals 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
If you’re self-employed, the amount eligible to be contributed 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 intended for companies that have no employees or if the only employee is your spouse. These plans function similarly to standard 401(k) plans, and allow you to contribute as both an employer and an employee with pre-tax money. This provides more savings than SEPs or IRAs; however, the increased savings potential often come with more constrained investment avenues. 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: Only business owners and their spouses can set up 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:
- Elective deferrals (as an employee) of up to 100% of your earned income from self-employment, up to the annual contribution limit. In 2025, those limits are $23,500, or $31,000 for those aged 50 and above, or $34,750 for those who turn 60-63 in 2025.
- Profit-sharing contributions (as an employer) are limited to 25% of your net earnings from self-employment, which is defined as net profit minus half of your self-employment tax and the elective deferrals you made.
The total contribution cannot exceed $70,000, or $77,500 for individuals aged 50+ (in 2025), $81,250 if you attain age 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: Defined benefit plans represents a type of retirement plan that provides a pre-established payout to self-employed individuals 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 get in retirement. This option is ideal for wealthier entrepreneurs who are focused on saving a significant sum for retirement and can commit to making sizeable contributions. Contributions offer tax-deferred growth, and withdrawals incur taxes as income in retirement.
Eligibility: Entrepreneurs running an owner-only business or employing fewer than five people can open an individual defined benefit plan, but it's generally suggested for individuals aged 50+ who earn at least $250,000 a year. Typically, good candidates for defined benefit plans tend to be:
- Business owners or partners who want to invest more than $70,000 (or $77,500 for individuals 50 and older)
- Organizations that already put in 3-4% and are willing to do more
- Organizations with proven consistent profit patterns
- Business leaders over age 40 who wish to accelerate savings or increase their retirement contributions rapidly
Contribution Limits: The maximum allowable contribution is calculated by an actuary based on your earnings, age, and retirement objectives. Limits on 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 focused on self-employed retirement strategies is an invaluable resource for those working for themselves. They bring the skills needed to navigate the complexities of retirement planning and develop a customized plan that aligns with your goals. An expert in your area will evaluate your financial situation, determine how much risk you’re comfortable with, and help you in choosing wisely about saving and investing for retirement. A key part of what we do for you includes:
- Help you choose a plan that suits your unique requirements
- Further adapt the plan to your needs even further
- Formalize a plan in writing in accordance with IRS guidelines
- Set up an asset trust plan
- Make sure you understand the plan's terms
- Track and fine-tune your plan to keep it aligned with your goals
- Deliver continuous support and financial insights to help you navigate your retirement journey
- Increase your retirement income by maximizing your social security benefits
Self-Employed Retirement Plans in Tallahassee, FL: Correct Capital's Process
Entrepreneurs in Tallahassee, FL who don’t have the time or expertise to manage their self-employed retirement plan independently can become overwhelmed as they look at their available plans. At Correct Capital, our Tallahassee, FL financial advisors handle the bulk of your retirement planning for you, and strive to ensure meeting your retirement goals as hassle-free as possible for you. We can help you get set up your self-employed retirement plan in four simple steps:
- Schedule a Call: It only takes 20 minutes, a member of our advisor team will assess if we're a good fit for you and your business. This short conversation allows us to learn about your needs with zero commitment or extensive time commitment on your part.
- Gather Information: Once we mutually decide to continue, we'll gather information, including your employee count, your present financial standing, and your long-term savings targets. This helps us create a custom plan suited specifically for your needs.
- Review Your Plan: After we put together a plan from the information you provide, we'll meet with you and go over your plan step by step to ensure you understand it and understand how it best correlates to your needs.
- Implementation and Monitoring: When we finalize on your plan, we'll implement the necessary steps so you can initiate your savings journey. Throughout our relationship, we'll have regular meetings and track your progress to keep it tailored to your evolving circumstances.
Our Tallahassee, FL financial advisors and retirement plan consultants are fiduciary advisors, which means they are committed by law and ethics to do what's in your best interest.
Other financial advisory services we offer in Tallahassee, 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 Tallahassee, FL
You don't see your business as "just a business", and your Tallahassee, FL financial advisors must deliver more than basic financial recommendations. At Correct Capital, we take the time to get to know our clients and their businesses to deliver personalized self-employed retirement plans. We offer all our Tallahassee, FL clients our I.O.U. promise: all guidance we provide will be independent, objective, and unbiased. To get started on your self-employment retirement plan, contact Correct Capital now at 877-930-401k or contact us online.
