Self employed retirement help

[kanga1]

I'm getting married in February. I've had a ROTH since college as well as employer plans so I'm on the right retirement path. My other half is a different story. He has nothing. He has been self employed his whole life and with some money issues along the way he has never done anything for retirement. He's finally on the financially responsible right track (thanks to me) and wants to start something for retirement. I'm 40 and he's 42. He's self employed as a sole proprietor, no employees, takes home over $150,000 a year but AGI on taxes is around $40,000. 

What is a good retirement plan for him? I'm familiar with ROTH IRA's but I also see a SEP IRA or a self employed 401k as a recommendation for sole proprietors. Is one of these 3 better than the other? I'm not sure if it's worth is to talk to a financial advisor or not. I've always used a financial advisor but that's because when I set up my ROTH 20+ years ago I had no idea what I was doing and I've just kept going to my advisor all these years. Plus my money has grown so much I'm scared to leave my advisor and screw it up on my own LOL, I'd rather pay the fees to use an advisor. But for my fiance I feel like we could figure something out on our own if we knew which plan to pick. I do have a separate fidelity investment account and have made some small investments in funds and played around with stocks so I have a idea of what I'm doing on my own.   

[sadlebred]

As long as he qualifies for a ROTH, he should do that first. The gains will grow tax free. I'll let others talk about the self employment options.

[chpmnk1015]

Following because i was going to ask a similar question.. DH is self employed and does a roth.. i feel like he should do something else as well.. I am starting a new job monday and will not have a 401k for a year so will do a roth but what else?

[winecat]

I don't mean to be a downer, but I kind of am. I hope that you'll consider doing a prenup to protect your retirement. Depending on your state's laws, if you were to divorce, you might have to split the growth in your retirement accounts, which at this point, could be significant. Same goes for his business.

[lemoncupcake]

Oct 30, 2021 10:46:19 GMT -5 winecat said:

I don't mean to be a downer, but I kind of am. I hope that you'll consider doing a prenup to protect your retirement. Depending on your state's laws, if you were to divorce, you might have to split the growth in your retirement accounts, which at this point, could be significant. Same goes for his business.

1,000%. Especially if he has a history of financial issues.

[kanga1]

Oct 30, 2021 14:11:03 GMT -5 lemoncupcake said:

Oct 30, 2021 10:46:19 GMT -5 winecat said:

I don't mean to be a downer, but I kind of am. I hope that you'll consider doing a prenup to protect your retirement. Depending on your state's laws, if you were to divorce, you might have to split the growth in your retirement accounts, which at this point, could be significant. Same goes for his business.

1,000%. Especially if he has a history of financial issues.

LOL trust me I'm up on all this. Divorced once and learning from my mistakes the first round 

[scout8]

I'm most definitely not an expert, but I have a Roth and a SEP IRA through Vanguard. I also have some other retirement accounts through traditional financial planners before this board taught me about Vanguard. I'm "semi retired" now so not currently making contributions, but when I was, I was incorporated with no employees. I'm not sure how that changes anything if your SO is not incorporated.

[jwright]

If it were me, I'd do the SEP IRA first to get the tax deduction now while he's in his high earning years. The SEP will reduce both income taxes and self employment tax. In theory, when he pulls the money out during retirement and is taxed he will be in a lower tax bracket (and no longer be paying self-employment tax).

[FrozenSunshine]

If you are established with and advisor and paying him fees, ask him the best setup. We run scenarios by our advisors all the time and aren’t charged. We each have our own and bounce each ones ideas off each other.