Solo 401(k) Getting Started Kit

Had a chance to review several Solo 401k start-up kits over the past few months and wanted to give a little insight into what it takes to start a Solo 401(k)

The standard plan establishment package is pretty simple but thick. You are actually starting a 401(k) plan. This might seem obvious but I can tell you from starting up company 401(k) plans, this is almost identical in the setup process.

The first thing you will need to fill out is the "Establishing the Plan" section

Here you will name your 401(k) program and setup the options like Life Insurance, and electing for the Roth option. It's pretty straightforward and will require a bunch of signatures as you the employer. This entire section is completed by the sole employer.

Next you will identify yourself as the employee and if you have a spouse as the other qualified applicant. Pretty straightforward.

Finally, the recordkeeping is where you can elect a custodian to be your recordkeeper. You will face setup fee's anywhere from $75-$2500. I have found the bigger companies charge less for setup and annual fees. Study each custodian to find your level of comfort working with them. This is a long term relationship you are building.

That is a brief cliffnotes version to the paperwork process of a Solo 401(k). If you have more detailed questions for me, feel free to leave a comment and I will do my best to answer your questins. Thanks for reading!

Kevin Kaczmarek is the founder of Capital Blueprints, LLC an IRA education and investment company in Carmel, IN. Recognized as an innovative thinker, teacher and business leader Kevin helps others achieve their financial goals with Self Directed IRA Investments, and Passive Income Strategies. Kevin can be reached at [email protected] or 317-564-4820