How to Use Cash Balance Pension Plans for Solo Entrepreneurs
How to Use Cash Balance Pension Plans for Solo Entrepreneurs 📌 Table of Contents Introduction to Cash Balance Pension Plans Benefits for Solo Entrepreneurs Contribution Limits and Tax Advantages Setting Up the Plan Combining with Other Retirement Accounts Considerations and Pitfalls Final Thoughts Introduction to Cash Balance Pension Plans Cash Balance Pension Plans are powerful retirement tools that blend features of traditional pensions and 401(k) plans. They offer fixed annual contributions and guaranteed returns, making them appealing for long-term planning. For solo entrepreneurs, this plan provides both tax deferral and a structured retirement funding mechanism. Benefits for Solo Entrepreneurs Solo entrepreneurs often lack access to employer-sponsored retirement plans. Cash Balance Plans allow them to contribute significantly more than with IRAs or solo 401(k)s. These plans are especially effective for individuals with high income...