Many experts agree an individual or solo 401(k) is ideal if you’re self-employed, with no employees except a spouse. Contributions are pretax, and the money grows tax-deferred, meaning you pay when you make withdrawals in retirement. “Your contributions may also make you eligible for added tax breaks,” Assaf says. “If your business is not incorporated, you can generally deduct contributions for yourself from your personal income. If your business is incorporated, you can count the contributions as a business expense.” Further, when you’re self-employed, you are considered both the employer and employee and can contribute more as a result: As an employer, as much as 25% of your salary; as an employee, up to $19,500 a year. (Plus an additional $6,500 if you’re over 50.) You can contribute only up to 100% of your compensation, Williams says, but the combined maximum tax-advantaged contribution this year is $58,000.
Related: 31 Tax Credits and Deductions That Could Save You Thousands