Trading Options in Your Charles Schwab Self-Directed Solo 401k Brokerage Account (AKA Company Retirement Account Master Account)

Trade Stock Options Schwab Solo 401k

While Charles Schwab also offers their onw solo 401k plan which tends to me more restrictive, a self-directed solo 401k plan from My Solo 401k Financial may be invested in equities including stock options using a Charles Schwab company retirement account brokerage account.  This is possible because you opened a solo 401k with My Solo 401k Financial and Charles Schwab is simply holding the solo 401k funds.

However, the highest level of options trading that may be done inside a self-directed solo 401k brokerage account held with Charles Schwab is level one options. Please CLICK HERE to use the Schwab application to add options trading to your self-directed solo 401k brokerage account.

Per the solo 401k Trust Agreement, you can use the solo 401k plan to invest in stock options. The retirement trust is tax exempt entity so gains from passive investments being bought and sold are deferred just like when stocks are bought and sold.
You can apply for options trading without applying for margin.
If one uses margin inside a solo 401k UBIT applies.
See link below.

Options Level QUESTION

I just spoke with Ameritrade and they said that due to their merger with Schwaab only Covered Calls are allowed in these self-directed solo 401k trust accounts. This change was in September. Do you know what level of options trading is available with the Charles Schwab company retirement account brokerage account for the self-directed solo 401k (the non Schwab solo 401k)?

While the solo 401k rules and our self-directed solo 401k plan does allow for all levels of options trading, it is ultimately up to the brokerage firm regarding the levels of options trading that they will allow under their brokerage account.
With respect to Schwab, our understanding and our clients’ experience has been the following with respect to the Charles Schwab brokerage account for the self-directed solo 401k:
  • You can start with options level 0.
  • This consists of Long stock/Short calls (covered calls)
  • Long stock/Long puts (protective puts, no indexes)
  • Collar Long stocks/Short calls/Long puts
  • Cash secured equity/puts writing
  • Must ask for and be approved for exception for any level over 0 (can go up to level 3)
For more information please reach out to 800-694-9449-SCHWAB RETIREMENT SERVICES

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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