Objective information about retirement, financial planning and investments



  1. I’m going to open a solo 401(k) account at Vanguard soon. It finally make sense to contribute more and this will help with our tax bill next April.

    • Roger Wohlner says

      Thanks for the comment Joe. I’ve looked at the VG solo 401(k) and it looks like a pretty good deal especially if you will investing all or primarily in VG funds/ETFs. Kudos for doing this and good luck.

  2. When evaluating the options for my wife we decided the a Solo 401(k) was definitely a better option for her than the SEP-IRA, mainly because of the contribution flexibility you describe above. I like the fact that it’s not limited to a percentage of your income.

  3. Another benefit came to my attention. I have a pretax IRA, over $250K. I also have an account with deposits that I couldn’t deduct, $50K plus some gains.
    Any Roth conversion would be prorated, i.e. about 5/6 of the conversion would be taxed, as the IRS doesn’t care that these accounts are different, it’s one big IRA spread around to different account numbers. Now, once my Solo 401(k) is established, I have the opportunity to transfer the large account, plus the growth from the smaller account, and leave a sum equal to my post tax deposits. Once that’s done, any conversion is for 100% post-tax money, and I’m set up to deposit to an IRA and convert to Roth if I’m still above the Roth limit.
    The Solo-401 allows for spousal deposits as well, which sets up my wife to make the same move. 20+ years of tax-free growth on our combined $100K in post-tax IRA money is nothing to ignore.

  4. I believe that the solo 401K is possible even if you have part time employees (working <1000hrs/yr). Is that correct.

    • Roger Wohlner says

      Sam thanks for your comment. The Solo 401(k) only works for situations with a sole employee or if a partner and/or a spouse in the business. Otherwise this solution does not work with non-owner employees and you would need to look at another small business retirement plan.

  5. thanks for sharing this

  6. Thanks for taking time and writing such an informative post. It now makes sense in investing in solo 401(k) account. Saving money is such an important task, but doing it the right way will reap you more benefits. People who are looking for solo retirement plan will find great advice in this blog post. Thanks!

  7. I think that the solo 401K is possible even if you are a part-time employee please share your information on this.

    • Roger Wohlner says

      Rahul thanks for your comment. A solo 401(k) would be possible for a PT employee if that person had income from a side venture in which they were the owner. It likely would not be doable as a PT employee of a company for that employer’s plan unless the PT employee was an owner of or partner in that company. This is not a definitive answer as I would need to know all of the facts and circumstances. I suggest you consult a knowledgeable tax or financial advisor about the specifics of your situation.

  8. Considering a solo 401(k) is one of the best things to do right now, and that is what I’ve been telling all of my friends. I hope that they’ll reconsider their decision and think about these 401(k)s once more.

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