Your Own 401(k)

Physician's Money Digest, November15 2004, Volume 11, Issue 21

If you're the only employee in yourmedical practice, it might pay to look intoa solo 401(k) plan, which can give youhigher contribution limits and moreflexibility than other tax-advantagedretirement plans. As the employer, youcan contribute up to 25% of your compensationinto a solo 401(k), and kick inanother $13,000 as the employee, up toa combined maximum of $41,000. Ifyou're over age 50, you can add another$3000 in catch-up contributions.With a solo 401(k), you can also borrowfrom the plan, which you usually can'tdo with other retirement plans, such assimplified employee pension IRA andKeogh plans. For a list of financial firmsthat offer solo 401(k) plans, contact the401khelpcenter.com (503-705-9548).