The Motley Fool Discussion Boards

Previous Page

Investing/Strategies / Retirement Investing


Subject:  Re: SEP v. 401k Date:  8/25/1998  11:22 AM
Author:  TMFPixy Number:  5163 of 88532

Greetings, Brad, and welcome. You asked:

I am self-employed. I converted my traditional ira to a Roth ira in 1997. I want to be able to save more $$ and I am unsure if a sep-ira or a 401k is the better method (or possibly something else I'm not aware of).
How can I establish either? Is it possible to have both? What is the maximum annual contribution to each?

Administratively a SEP is far simpler and cheaper to operate as a self-employed person than a 401k. Additionally, it will allow you more latitude and discretion in the amount of contributions from your net compensation each year.

The usual plans for a self-employed person are the SEP, SIMPLE or Keogh. You can read a brief description of each as well as the 401k in my Foolish Retirement Plan Primer at .

For further details, you should also get and read IRS Publication 560, Retirement Plans for Small Business, available at .


Copyright 1996-2018 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us