Updated 2026-03-30
Solo 401(k) vs SEP IRA: Which Is Right for You?
Side-by-side comparison of the two most popular self-employed retirement plans
Solo 401(k) allows employee deferrals ($23,500) plus employer contributions (25%), with catch-up options and Roth. SEP IRA is simpler: employer contributions only (25% up to $70,000), no catch-up, no Roth, no loans. Solo 401(k) typically wins for incomes under $200K.
Key Differences
- Employee deferrals: Solo 401(k) yes, SEP IRA no
- Catch-up contributions: Solo 401(k) yes ($7,500-$11,250), SEP IRA none
- Roth option: Solo 401(k) yes, SEP IRA no
- Loans: Solo 401(k) up to $50,000, SEP IRA not allowed
Pavlo Pyskunov
Managing Director & Investment Fund Director
Pavlo Pyskunov analyzes employer-sponsored retirement plans using IRS publications and DOL Form 5500 filings, helping workers maximize their 401(k) savings through data-driven guidance.
Last updated: 2026-03-30