Self Employed and Saving for Retirement


Hi All! I have done some research on my own with this but I figured I would send this question out to you all because I know many of you are business owners as well!

I am the owner of two local ice cream shops so I don’t have a company provided retirement plan. Unfortunately, my husband works for a small engineering firm that also has no retirement or insurance provided. With that we are pretty stuck figuring everything out for ourselves.

Our biggest issue is how we should save for retirement. We are both maxing out IRAs every year but we would really like to save more! I know there are options for SE 401ks but a lot of the research I have done shows that this is mostly for business owners without employees.

I would love to hear any tips you all have or just what you have done to save! Thanks so much!


if you don’t want to offer a retirement plan to the employees so that you can take adavantage of it yourself, your best bet is probably just to save in a taxable account. If you have particularly high taxes, you might consider a vanguard variable annuity, though I don’t have any personal experience with them:


Thanks @_TJ. That’s what all my research was leaning towards. Because almost all of my employees only last a couple of years and we have so much turnover with teenagers it wouldn’t make sense to offer them anything. Thanks for the suggestion on the annuity. I will absolutely look into that!


If your margins can handle a 2% contribution to your employees, also look into a SIMPLE IRA:


I was actually listening to a podcast yesterday on this exact topic - check out the Money Guy.

They discuss SEP IRA’s (significant downsides if you have employees, which you do), Simple IRA’s (which are for companies with less than 100 employees), and solo 401ks (which as you note are just for people without employees).


You may want to consider setting up your own 401k plan at work. Depending on your employees status (ex. mainly part-time, lots of turnover, etc.), few of them may qualify to participate. Setting it up as a safe harbor plan would minimize the testing required, so the admin cost would be lower.

The downsides would be the costs to set up & administrate and the potential for a match to your employees (although few may participate in the plan). If your husband also did some work for the shops, you both could participate in the plan and each save $18k/year ($24k/year when you turn 50). Deferring the taxes on $36k (or $48k) per year could be substantial. Also, if your marginal tax rate is 25% or lower, consider a Roth 401k, too.

If you have ton of turnover, a SEP may work as well. Here are the minimum requirements for SEP participation per the IRS:

Which employees are eligible to participate in my SEP plan?

Employees must be included in the SEP plan if they have:

** attained age 21;**
** worked for your business in at least 3 of the last 5 years;**
** received at least $600 in compensation (in 2016 and 2017) from your business for the year.**

Your plan may use less restrictive requirements, for example age 18 or three months of service, to determine which employees are eligible.

Look at your employee records and see how many, if any, would qualify.



I will add this to my podcasts to listen to. Thanks so much!


This is exactly what I needed @60MinuteFinance! Thanks so much! Most of our employees are under 21 so this would be perfect. I am sure we could handle offering it to those over 21 but I am sure not many of them would participate.


Glad it was helpful!



The Money Guy show JUST did an episode on this. I listened to it yesterday!! I think you’ll find it helpful.


HAHAHA - I JUST shared the same link, then saw your comment in the thread. Too funny, we both listened to the same podcast, on the same day!! (What time?? Mine was 4:45 am, bet I beat you to it! Yes, I have a VERY early commute on the days I drive down to the city from our cabin. Have a small apartment 1 block from the office, so thankfully I only have to drive it once a week!).


Lol, I actually was listening to it on the way home from work last night.