Money Buzz 2/03
A 401(k) option for entrepreneurs, getting capital from an IRA and more
Gimme a "K"!
Thought that starting your company meant missing out on the pros of
401(k) retirement plans? Not anymore. There's now a 401(k)
option for entrepreneurs. "Until now, small-business owners
have had to rely on simplified employee pension plans (SEPs),"
says Jim Thigpen, president of Atlanta-based Monarch Financial
Services. "But last year they created a new 401(k) plan
that allows people to put in more than they could through a
SEP."
The new plan is also easy to administer and relatively inexpensive to open. While SEPs enable self-employed people to contribute just 13 percent of their income, the new 401(k)-sometimes referred to as a Uni-K-allows contributions up to 25 percent. Both plans have similar annual caps, which means that for individuals with incomes of more than $160,000, allowable contributions are equal, but Uni-K holders can borrow against their holdings, something you can't do with a SEP.
Continue reading this article - and everything on Entrepreneur!
Become a member to get unlimited access and support the voices you want to hear more from. Get full access to Entrepreneur for just $5.
Entrepreneur Editors' Picks
-
These Co-Founders Are Using 'Quiet Confidence' to Flip the Script on Cutthroat Startup Culture and Make Their Mark on a $46 Billion Industry
-
My 7-Year-Old Daughter Started Selling Eggs. Here's What She Taught Me About Running a Startup.
-
Why You Need to Become an Inclusive Leader (and How to Do It)
-
Career Transitions You Can Make in Your 40s and 50s
-
Billionaire Naveen Jain Is an Expert at Disrupting Fields He Has No Experience In. His Secret Sauce for Building Multi-Million Dollar Companies? 'You Have to Come as Naive.'
-
4 Principles to Develop Next-Level Leadership at Your Company
-
This Filipino American Founder Is Disrupting the Beverage Aisle by Introducing New Flavors to the Crowded Bubbly Water Market