A personal 401(k) plan is also called an individual or solo plan. Often used by the self-employed, with these plans you are both the employee and employer. As such, you can actually contribute more than in a traditional plan because you can match your own contributions.
Personal 401(k) Plans FAQs
A 401(k) plan is a retirement plan offered by an employer designed to help employees save for retirement.
A personal 401(k) plan is also called an individual or solo plan. With these plans you are both the employee and employer. You can contribute more than in a traditional plan because you can match your own contributions.
Any person who receives income from self-employment activities or owns a business with no employees other than themselves and their spouse can open a Personal 401(k).
You may contribute up to 100% of your earned income each year, up to a maximum of $58,000 in 2021. This includes both employee and employer contributions.
You may invest your Personal 401(k) Plan funds in any type of investment such as stocks, bonds, mutual funds, index funds, ETFs or other options available through the plan administrator you choose.
True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists.
True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics.
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