An updated Solo 401k maximum contribution serves as your helpful guide to know how much you need to contribute and comply with the Individual 401k plan requirements. The Self-Directed 401 k retirement account is a lucrative and innovative investment that would certainly help boost your retirement money through viable investment options available. In order to maximize your earnings and profits, it is not enough to know which the 401 k investment opportunity is. You must also know and choose the right plan provider to help you in your wealth-building quest.
About the Updated Solo 401k Maximum Contribution
It is imperative for plan participants to know the up to date maximum contribution limit of the Participant-Only 401 k retirement account. There are two types or electives that could determine the amount of your contribution limit. The employee salary elective states that plan participants that are below 50 years of age can contribute up to $18,000. Plan owners that are 50 years old and older are allowed an additional $6,000 catch-up contribution, making their total combined contribution up to $24,000.
As of 2015, the updated Solo 401k maximum contribution for profit sharing elective is 20%-25% of the business compensation. The total limit, including both types of contributions, is up to $53,000. For plan participants who are 50 years old and older, the allowed combined contribution is up to $59,000. In case the plan participant’s spouse decided to make the same contribution to the same account, the maximum contribution limit is up to $118,000. Plan owners can definitely use tools or resources such as the Individual 401 k calculator in order to determine their current contribution limit.
The Bigger, The Better
The updated Solo 401k maximum contribution is considered almost 10 times higher compared to Roth IRA or Traditional retirement accounts. The higher your maximum contribution simply means the bigger your retirement savings. Bigger retirement money allows you to have better opportunities to grow your money through viable wealth-building opportunities. The Solo k retirement plan is a lucrative way to help you finance your investment through using your retirement money.
Learn the updated Solo 401k maximum contribution and know your contribution deadline in order to comply with your plan requirements. Plan participants need to submit their election on what type of contribution they prefer, whether it is employee deferral or profit sharing. Electing your contribution type must be done by December 31st of the current fiscal year while the actual contribution can be made until the tax-filing deadline of the following year.
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