STUDmoney · Accounts

Solo 401k

Also known as

individual 401k · self employed 401k · one participant 401k · solo 401(k)

Community talk may be wrong. Not financial, tax, legal, or investment advice. No return or outcome is promised.

In brief

A solo 401k is a one-participant retirement plan for self-employed people, with employee and employer contribution hats.

The common picture

No employees (except maybe a spouse)That is the ‘solo’.

Two contribution roles: employee and employerThe owner can contribute in both roles when eligible; the amounts use different rules.

A provider, not a spreadsheet IRAFidelity / similar individual 401k.

Profit firstEmployer share needs a real net.

2026 employee deferral limit: $24,500 before catch-upsThis limit is shared with other 401(k)/403(b) employee deferrals.

2026 overall additions limit: $72,000, limited by eligible earningsEmployee and employer contributions share that total; qualifying catch-ups are separate.

People leaving a W-2 compare it with a SEP IRA, miss deadlines, and keep books clean enough that a tax person can see the profit.

Good to know. Employees other than a spouse. Deadline traps. Not a SEP-only religion. Not advice.

What people say

The job: retirement account for a one-person shop.
r/personalfinance self-employed compares solo 401k vs SEP IRA.
Mega backdoor sometimes exists here too if the plan allows — different card.
Not advice.

How people do it

Confirm they are actually self-employed with profit.
Open the plan before the deadline people always miss.
They keep the match-of-one honest — books, not vibes.

Amounts people use

Employee deferral cap still exists.
Employer percent-of-net is the second lever — tax person, current year.

How people keep it

A provider login and a profit number.

How it may feel

Like HR, but they are HR.

How long

While the shop is theirs.

The longer notes

The match / Roth vs Traditional / mega backdoor still apply as ideas.

Good to know

Hiring someone and keeping a solo plan on vibes.

Earlier wording (updated)

Two hats Employee deferral plus employer contribution stories.

Checked sources

Selected links for the notes above, not a review of every historical claim.

IRS retirement-plan contribution limit table (opens in a new tab)
Official context · Checked 2026-09-12
2026 defined-contribution overall annual additions limit is $72,000; employee elective-deferral base $24,500; qualifying catch-ups handled separately. This reference explains the named format or rule. Individual community accounts remain attributed in the notes.
IRS: participation in more than one retirement plan (opens in a new tab)
Official context · Checked 2026-09-12
457(b) has a separate limit including employee and employer contributions; 401(k)/403(b) employee deferrals share the individual limit. Numeric examples on this page are older, so 2026 numbers come from the separate current IRS source. This reference explains the named format or rule. Individual community accounts remain attributed in the notes.