Is a Self-Direct 401k Right for You?

Referred by others names such as Self-Directed Solo 401k, Solo 401k, Solo K or Small 401k, a self-directed 401k plan may be right for you based on the following.

Qualification

If you are considering investing in alternative investments such as real estate, notes, small companies or gold, a self-directed 401kmay be right for you. However, you must first determine if you qualify for a small company 401k because a self-directed 401k plan is designed for the individual business owner or self employed and his or her spouse.

Excluded

As a small business owner, you still qualify for a self-directed 401k plan even if you have other employees. You see the law permits you to exclude from a self-directed 401k the following types of employees:

Those under age 21

Part time employees (work less than 1,000 hours per year)

Union employees

Non-resident aliens with no U.S. income

Some Advantages

  • No income limit restrictions for Roth contributions
  • You can invest in an S corporation
  • Option to buy life insurance
  • Permitted to borrow (take a personal loan) up to $50,000 or 50% whichever is less
  • Gains from leveraged real estate purchases are not subject to Unrelated debt-financed income (UDFI) Tax (refer to IRS Publication 598 for information on UDFI)

About Mark Nolan

Each day I speak with energetic entrepreneurs looking to take the plunge into a new venture and small business owners eager to take control of their retirement savings. I am passionate about helping others find their financial independence. Having worked for over 20 years with some of the top retirement account custodian and insurance companies I have a deep and extensive knowledge of the complexities of self-directed 401ks and IRAs as well as retirement plan regulations. Learn more about Mark Nolan and My Solo 401k Financial >>

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  • About MySolo401k

    We help our clients take control of their retirement money. Our products and services provide our clients the freedom to invest their retirement savings in their own business as well as alternative investments such as real estate, private companies, promissory notes, precious metals, tax liens and equities.
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