My 3 favorite solo 401(k) and self-directed IRA providers, so far

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When two different financial / tax advisors encouraged me to look at solo IRA or 401(k), I figured they both can't be wrong!

I spent the weekend visiting lots of websites and reading lots of content. I'm down to three providers that I think have the best educational content, the easiest ways of working with them, and good reputations:

* RocketDollar https://www.rocketdollar.com

* My Solo 401k Financial https://www.mysolo401k.net

* IRA Financial Group https://www.irafinancialgroup....

I'll post an update to this thread once I choose one and go though the account opening process.


    Thanks @Cooper Marcus

    Of course, the threshold considerations are whether (i) you are eligible (i.e. self-employed with no full-time w-2 employees) and (ii) retirement funds in an account that you can rollover (i.e. former employer plan and/or non-Roth IRA that is invested in investments that can be liquidated an acceptable cost).

    Assuming that you cross these threshold issues, here are some additional comments/considerations:

    1. Confirm that the provider has a pristine reputation (e.g. Better Business Bureau reviews, etc.).

    2. You may wish to confirm that the new 401k provider has experience with the particular investments in which you intend to invest your retirement funds as you very likely will have questions in terms of the mechanics (e.g. how do you invest in real estate, etc.).

    3. You may wish to confirm that the new 401k provider will handle the ongoing compliance support such as any required 5500 filing (e.g. 5500-ez for a one-participant plan with assets in excess of $250,000), any required tax reporting (e.g. 1099-r in the event of a distribution or in-plan Roth conversion), mandatory plan updates and amendments, etc.

    4. If you might take a 401k loan, you may wish to confirm that the new 401k provider will prepare the required 401k participant loan documents.

    @Cooper Marcus

    Between the self-directed IRA and the Solo 401k, the Solo 401k is usually the better choice if you're eligible. The Solo 401k requires self-employment activity, but will allow you to take participant loans while the IRA does not.

    A few other Solo 401k benefits:

    *​Compared to an IRA, Solo 401k contribution limits are roughly ten times higher.

    *There is no custodial requirement for the 401k.

    *You don't need the additional expense and administration of an LLC to have checkbook control.

    *There is a built in-Roth component whereas IRAs are either traditional or Roth, not both.

    *A spouse can also participate in the same Solo 401k plan.

    *The Solo 401k has additional tax benefits over an IRA when investing into real estate using leverage.

    *The penalties for prohibited transactions are less severe, though it's best not to utilize this benefit :)

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