Self-employed retirement plans Toledo, OH. The flexibility of running your own company in Toledo, OH is one of the best aspects of being self-employed. That said, this independence can come with certain challenges, especially when it comes to planning for retirement, because you don't have the option of a workplace retirement plan. Only 13% of self-employed individuals have a workplace retirement plan, although many would be better off exploring their options. In addition to enjoying a more comfortable retirement, partnering with a financial advisor in Toledo, OH to set up your self-employed retirement plan offers significant tax advantages that allow you to move your business forward.
Few Toledo, OH investment consulting 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 (check out our story here), and we are deeply experienced in helping businesses with their retirement planning needs. We know that your goals for your business and retirement aren’t limited to simple financial figures, and we strive to offer tailored solutions to meet your unique goals. Read on to discover about your self-employed retirement plan options in Toledo, OH, or call Correct Capital at 877-930-401k or contact us online to talk to a small business financial advisor in Toledo, OH today.
Schedule a Meeting With an Advisor Today
Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.
Schedule a 15-Minute Introductory Call
More From Correct Capital Wealth Management
Explore how Correct Capital Wealth Management can help guide you toward smarter decisions, clearer goals, and lasting financial success.
Subscribe To Our Newsletter Listen To Our Podcast Watch Our YouTube Channel
Why Toledo, OH Self-Employed Individuals Should Have a Retirement Plan
Retirement plans for self-employed individuals not only prepare you for the future, they also deliver real benefits today. From flexible contributions to significant tax savings, working with a financial advisor in Toledo, OH enables you to customize your retirement plan to align with your individual circumstances.
Flexibility That Fits Your Income
For those with fluctuating income annually, a plan like a SEP IRA or Solo 401(k) offers the option to tailor how much you save:
- Customizable Contributions: Contribute more during high-income years and cut back when your earnings dip, so your plan fits your cash flow.
- Roth Options: 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 believe your tax rate will increase in the future.
Save Money on Taxes
Self-employed retirement plans provide powerful tax benefits:
- Tax-Deductible Contributions: Contributions to a Solo 401(k) shrink your tax liability, 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, giving your money more time to grow.
- State-Specific Incentives: Based on your location, you might access extra credits as a self-employed individual. These local incentives can make these plans even more advantageous.
- Retirement Savings Contributions Credit (Saver’s Credit): Qualified participants can claim a tax 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
Creating a stable future goes beyond just how much you save—it’s also linked to the way you invest:
- Diversified Portfolios: Allocating your investments across different stocks, bonds, and alternatives can help reduce risk while continuing to build your retirement fund.
- Emergency Back-Up: Pairing your retirement plan with a business emergency fund ensures you don’t using your retirement funds during challenging periods and risking extra costs.
Plan for the Future of Your Toledo, OH Business
Preparing for retirement also helps you prepare for what’s next with your Toledo, OH business:
- Selling Your Business: For those considering a sale, accounts such as SEP IRAs or Solo 401(k)s remain your personal assets and don’t transfer with the business. These plans can provide the steady income you’ll need during retirement. Keep in mind that while selling a business often leads to a capital gain, contributions to retirement accounts are restricted by contribution limits (e.g., as much as $7,000 for IRAs or up to $70,000 for Solo 401(k)s, with catch-up contributions, depending on plan details).
- Minimizing Taxes: Strategically planning your contributions can reduce the taxes you might face when you pass on your business.
- Succession Planning: If you’re passing the business on, your nest egg provide financial security during the change. You can also work with a financial advisor who specializes in succession planning and retirement accounts to reduce taxes during the sale.
With the best-fit retirement strategy, you can take control of your financial future, cut down your tax obligations, and create a strong framework for both your retirement and your business goals.
Why Start a Self-Employed Retirement Plan in Toledo, OH Now?
Time remains one of the most valuable factors in retirement planning. Starting early not only helps you grow a larger nest egg but also reduces the stress of playing catch-up as you get older. Here’s why it makes sense to begin today:
The Cost of Waiting
Waiting to start your retirement fund can have a substantial impact on the savings you’ll have when you reach retirement age. The main reason is compound interest—the concept where your investments generate earnings, and those returns, subsequently, earn even more returns. The more time your money has to grow, the larger the effect of this growth.
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 postpones starting contributions to age 40 but saves $7,500 annually to catch up.
By age 65, assuming 7% annual return:
- Alex contributes $180,000 and accumulates $691,184.39*.
- Taylor invests $195,500 but achieves a total of only $474,367.78*.
How Early Contributions Grow
Even modest contributions invested steadily often create significant growth. Take a look at this scenario showing the power of compounding:
- Starting at age 25: If you invest $200 per month in a retirement plan with an expected yearly growth rate of 7%, you’ll grow to approximately $497,303.29* by age 65.
- Starting at age 35: Contributing 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.
Starting sooner, the lower your annual savings needs each year to achieve your retirement goals.
*These calculations represent estimates derived from 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. Actual results may vary due to elements like market conditions, fees, and your unique situation. Be sure to speak with a financial advisor for guidance tailored to your needs.
Take Control of Your Financial Future
As a self-employed person in Toledo, OH, it might seem easier to focus more on reinvesting in your business over saving for retirement. However, starting a plan now gives you the chance to:
- Take advantage of growth that is tax-deferred or tax-free withdrawals down the road.
- Enjoy contribution flexibility that align with your cash flow.
- Build a financial cushion that offers peace of mind, no matter how your business develops.
The sooner you start, 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 creating for yourself the opportunity to turn your attention to your dreams—both for your retirement years and your Toledo, OH business.
Types of Self-Employed Retirement Plans
There are several retirement savings options open for entrepreneurs in Toledo, OH, each providing its own advantages and considerations. A financial advisor can help you learn about the benefits and drawbacks of each plan and choose the one ideal for your needs. Generally speaking, your self-employed retirement plan options in Toledo, OH include:
Traditional or Roth IRA
Plan Overview: Individual Retirement Accounts (IRAs), as explained here, represent retirement savings vehicles that offer distinct tax benefits. In a traditional IRA, contributions are typically tax-deductible, and returns grow free of current taxes, but money taken out during retirement are taxed as income. In contrast, Roth IRA contributions using income already taxed, but qualified withdrawals in retirement, including earnings, are not taxed. In both types of accounts, withdrawals are penalty-free provided 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 remain $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 serves as a retirement savings option that enables those who are self-employed to contribute a percentage of their net earnings. Contributions are strictly employer contributions an employer, so, as a self-employed individual, you (the employee) are limited to contributions from the employer role more than 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 flat-dollar amount or a percentage of wages to employee accounts. This type of plan is a good option for companies with fluctuating revenue streams. In contrast to some alternatives, SEP IRAs lack costly startup or administrative fees.
SEPs function like standard IRAs, where the contributions are tax-deferred and money withdrawn is subject to income tax.
Eligibility: Employers of any type, including self-employed individuals can establish 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: A Solo 401(k) plan, also called an Individual 401(k) or one-participant 401(k) plan, is a self-employed retirement plan intended for businesses with no employees or if the only employee is your spouse. This type of plan are similar to traditional employer-managed 401(k) plans, and allow you to contribute as both an employer and an employee with pre-tax money. This offers more savings versus SEPs or IRAs; however, the additional opportunities often come with 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 may establish and contribute to a solo 401(k).
Contribution Limits: If you are self-employed with a solo 401(k) plan, you can make two types of contributions:
- Employee contributions of up to 100% of your earned income from self-employment, up to the annual contribution limit. For 2025, the limits will be $23,500, or $31,000 if you're over 50, or $34,750 if you attain age 60-63 in 2025.
- Profit-sharing contributions (as an employer) are limited to 25% of your adjusted self-employment income, which is calculated as net profits less half of your self-employment tax and the elective deferrals you made.
Your combined contributions must not surpass $70,000, or $77,500 for individuals aged 50+ (as of 2025), $81,250 for those aged 60-63 in 2025.
Individual Defined Benefit Plan
Plan Overview: A defined benefit plan represents a type of retirement plan that guarantees a set amount to self-employed individuals 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 have in retirement. This strategy is recommended for higher-income professionals who want to save a substantial amount for retirement and are willing to make larger deposits. Contributions are tax deferred, and withdrawals incur taxes as income upon retirement.
Eligibility: Any self-employed individual operating a solo business or with a small staff of under five can open an individual defined benefit plan, but it's most commonly suggested for those over 50 who make $250,000 or more annually. Generally, good candidates for defined benefit plans include:
- Partners or owners who aim to deposit 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 showing consistent profit patterns
- Business leaders over age 40 who desire to "catch up" or boost savings within a short timeframe
Contribution Limits: The cap on contributions requires calculation from an actuary based on your income, age, and retirement goals. Allowable contributions are updated yearly.
The Importance of a Financial Advisor in Toledo, OH for Your Self-Employed Retirement Plan
A financial advisor in Toledo, OH experienced with retirement plans for the self-employed can be an invaluable resource for self-employed individuals. They bring the skills needed to navigate the complexities of retirement planning and develop a personalized approach that matches your objectives. Your advisor in Toledo, OH will review your finances, determine how much risk you’re comfortable with, and guide you in choosing wisely about saving and investing for retirement. A key part of what we do for you includes:
- Guide you in choosing a plan that aligns with your objectives and circumstances
- Tailor the plan to fit you personally even further
- Adopt a written plan as required by IRS rules
- Arrange a trust plan for assets
- Ensure you comprehend the plan's terms
- Review and modify your plan to keep it aligned with your goals
- Deliver continuous support and financial insights as you continue on the road to retirement
- Boost your retirement earnings by maximizing your social security benefits
Self-Employed Retirement Plans in Toledo, OH: Correct Capital's Process
Self-employed individuals in Toledo, OH who lack the time, interest, or knowledge to oversee their self-employed retirement plan on their own can become overwhelmed when faced with their options. With Correct Capital, our Toledo, OH financial advisors take on the majority of your retirement strategy for you, and strive to ensure meeting your financial objectives as hassle-free as possible for you. We will guide you in creating your self-employed retirement plan in a quick, four-step process:
- Schedule a Call: It only takes 20 minutes, a member of our advisor team can help understand if our services align for you and your business. This initial call lets us get a sense of your goals with zero commitment or extensive time commitment on your part.
- Gather Information: If we both decide to move forward, we'll request information, including whether you have employees, your present financial standing, and your retirement goals. This allows us to put together a personalized strategy suited specifically for your needs.
- Review Your Plan: When we finalize a plan based on the information you provide, we'll schedule a meeting and review your plan thoroughly to ensure you understand it and explain its fit to your circumstances.
- Implementation and Monitoring: After we agree on your plan, we'll set everything up so you can begin contributing. Over the course of our partnership, we'll check in and review your strategy to keep it tailored to your evolving circumstances.
Our Toledo, OH financial advisors and retirement plan consultants act as fiduciary advisors, which means they are required by law and ethical standards to prioritize your needs above all else.
Other financial advisory services we offer in Toledo, OH 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 Toledo, OH
You don't see your business as "just a business", and your Toledo, OH financial advisors must deliver more than simply sound financial advice. At Correct Capital, we take the time to get to know our clients and their businesses to deliver personalized self-employed retirement plans. To every client in Toledo, OH, we provide 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, contact Correct Capital now at 877-930-401k or contact us online.
