There are many advantages to establishing a Fulcrum Self-Directed 401(k) plan. While the list can be expansive, think of the following benefits as your “Top Ten List” for why you should consider establishing a solo 401(k).
1) Freedom of Investments – Want to invest in any asset not prohibited by IRS and DOL regulations…now you can! The power of investing into non-traditional assets and not just being limited to investing into traditional assets that your broker recommends. You can invest in WAY more than what Wall Street is offering you!
2) Diversification – You have it with the Fulcrum Self-Directed 401(k)! Why be limited to diversification within the world of stocks, bonds and mutual funds? Is that true diversification? What about real estate? What about precious metals? Don’t you think that you should have a menu of investment choices that is not limited? You can!
3) Control – YOU are the 401(k) Trustee, not some other individual or company. You can dictate the operation of your plan and the investments you have to choose from.
4) Protection – Protect your retirement plan against market fluctuation and volatility. Why rely solely on your broker to protect your retirement funds from such volatility?
5) Investing with others? – You can! While one must follow all IRS Prohibited Transactions, you now have the ability to potentially invest with certain family members, friends, business associates and strangers (if you want).
6) Rollovers and Transfers – Did you know that, general speaking, you can rollover or transfer practically any other retirement plan funds into your new 401(k)?! You can! One notable exception is the impermissibility to rollover Roth IRA funds. However, the ability to rollover or transfer practically any other retirement plan funds into your 401(k) gives you immediate funding for your plan and the investment activities of the plan.
7) Contributions – Not only can you make a high level of annual contributions (up to potentially $57,500), you can make contributions in both a pre-tax (traditional) or after-tax (Roth) manner….or even a combination of the two. Being the self-employed participant of your Solo-K plan, you can decide the tax-favored manner in which you make your contributions.
8) Plan Loans – You have the freedom and flexibility to take participant loans from the plan. Sure, there are IRS rules (think of duration, interest rate, etc.) to be followed, but YOU have the freedom to make that choice. Borrow up to $50,000 or 50% of the account balance (whichever is less) for any purpose you desire.
9) No Custodian Fees — As you may already know, a self-directed IRA will have custodian fees associated with the IRA LLC. With you self-directed 401(k) plan, you will avoid a custodian fee.
10) Other Plan Benefits – There are many. Solo 401(k) benefits were intended for to provide extensive benefits to an employer sponsored plan. With the individual, self-directed 401(k) plan, you have a tremendous amount of benefits, including asset protection.
If all this sounds good and you’d like a free consultation, give me a call at (866) 331-6350.