Your individual retirement plan should match your goals with your risk tolerance and can include a balanced blend of investment vehicles.

• Traditional Individual Retirement Account (IRA) – Contribute an amount equal to your taxable compensation up to a maximum of $7,000 or  $8,000 if 50 or older (2024). Contributions may be tax-deductible depending on income, tax-filing status and coverage by an employer-sponsored retirement plan. Qualified distributions are taxable as income.
• Roth IRA – Similar to traditional IRAs except that contributions are not tax-deductible, but qualified distributions are tax-free.
• Retirement Investment Accounts – These can be other savings or investment accounts that are earmarked specifically for retirement.

Self-Employed Individuals

As your own employer, you have the sole responsibility of funding your retirement. You have several options from which to choose, including two types of IRAs that enable you to provide retirement funds for your employees as well.

• Solo 401(k) – An independent 401(k), or Solo 401(k), is a tax advantaged retirement savings plan available to individual small business owners and their spouses. You may be able to contribute up to  $69,000 (2024), and an additional $7,500 (2023) can be contributed for those above 50 years of age. As an employer, you can also contribute an additional profit-sharing contribution of up to 25% of your net self-employment income.
• SEP IRA – A SEP plan allows employers to set up SEP IRAs for themselves and each of their employees. Employers generally must contribute a uniform percentage of pay for each employee. Employer contributions are limited to the lesser of 25% of total compensation or $69,000 (2024). If self-employed, contributions are generally limited to 20% of net income.
• SIMPLE IRA – These plans are for companies with 100 or fewer employees. Employees can contribute a maximum of $16,000 (2024), and employees age 50 and older may make an additional catch-up contribution of $3,500 (2024), bringing their annual maximum to $19,500 (2024). Employers can choose to make a 2% contribution to all employees or an optional matching contribution of up to 3%.

Employer Retirement Plans

A good employer-sponsored retirement plan can give your company a competitive edge in recruiting and retaining top-performing employees. For businesses, nonprofits and government agencies, our Arvest Wealth Management retirement plan consulting team offers specialized solutions and support that help your business manage investments, oversee custodial accounts and provide employee education.