If you’re self-employed and considering a Solo 401(k), you might be wondering: Can I use it to invest in individual stocks? The answer is a clear yes — but there are some important rules and account structures you’ll want to understand before placing that first trade.
In this post, we’ll break down what you need to know to take full advantage of stock investing within a Solo 401(k) plan.
Watch: How to invest in individual stocks using a self-directed solo 401k with checkbook/wire control
What Investments Are Allowed in a Solo 401(k)?
Solo 401(k) plans offer a wide range of investment options. These include:
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Individual stocks
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ETFs (Exchange-Traded Funds)
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Mutual funds
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And beyond…
As long as the investment isn’t prohibited by the IRS (such as collectibles or personal use property), you’re generally free to make it within your plan.
Brokerage-Based vs. Self-Directed Solo 401(k)s
Not all Solo 401(k)s are created equal. There are two primary types:
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Brokerage-Based Solo 401(k): Typically limits you to traditional securities like stocks, mutual funds, and ETFs.
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Self-Directed Solo 401(k): Offers a wider range of investments, including real estate, private equity, and more — in addition to stocks and traditional assets. You can also process a solo 401k participant loan, and the plan comes with the $1,500 auto contribution tax credit and you are not required to make annual contributions to qualify for the tax credit.
Choosing between the two depends on your investment goals and the level of control you want.
My Solo 401k Financial Vs. Fidelity Investments
- Visit here to learn about a self-directed Solo 401k offered by My Solo 401k Financial Vs. a Fidelity Solo 401k plan.
My Solo 401k Financial Vs. Charles Schwab
Visit here to learn about a self-directed Solo 401k offered by My Solo 401k Financial Vs. a Charles Schwab Solo 401k plan.
Choosing the Right Platform for Stock Investing
If your focus is on individual stocks, you’ll want to select a platform that:
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Offers low trading fees
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Has broad market access
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Integrates smoothly with your Solo 401(k) structure (especially if using checkbook control)
Some platforms specialize in Solo 401(k)s and allow direct trading without needing a custodian to approve each transaction.
Bonus: Trade Stocks Tax-Deferred (or Tax-Free)
One of the best-kept secrets of investing through a Solo 401(k)? Tax advantages.
When you buy and sell individual stocks inside your Solo 401(k):
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Gains grow tax-deferred (traditional Solo 401(k))
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Or tax-free (Roth Solo 401(k))
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No capital gains tax applies while the funds remain in the account
This can lead to significant compound growth over time — especially for active traders.
Final Thoughts
With a Solo 401(k), you can take charge of your financial future while enjoying the flexibility to invest in individual stocks — and much more. Just be sure to set up your plan with the right structure and provider to ensure you’re fully compliant and maximizing your tax benefits.
