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IRA Financial Blog

How to Contribute Over $90K to Your Solo 401(k) – Episode 435

Adam Talks

On this episode of Adam Talks, Adam Bergman, Esq. discusses the Mega Backdoor Roth 401(k) and how you can contribute over $90,000 to your Solo 401(k) this year!

How to Contribute Over $90K to Your Solo 401(k)

On this episode of Adam Talks, tax attorney and founder of IRA Financial, Adam Bergman, discusses strategies to maximize contributions to a Solo 401(k) beyond the annual income limitations. He explains how individuals can contribute more by leveraging both employee deferrals and profit sharing options. Bergman provides examples for different scenarios, such as being a sole proprietor or having a C or S Corp, to illustrate how contributions can be increased based on income and age. He emphasizes the importance of understanding the rules around employee deferrals, profit sharing, and the potential for a Mega Backdoor Roth contribution.

Bergman introduces a scenario where an individual with a full-time job can also have a side business, allowing them to take advantage of the Mega Backdoor Roth strategy. By combining contributions from the full-time job’s 401(k) plan and the side business, individuals can potentially exceed the annual limitations and contribute significantly more towards their retirement savings. Bergman highlights the tax implications of these contributions, noting the benefits of Roth contributions for long-term tax-free gains.

Additionally, he discusses the benefits of prioritizing Roth contributions over traditional tax-deductible contributions, emphasizing the potential for tax-free gains in the future. He suggests a strategy where individuals focus on maximizing Roth contributions to build substantial retirement savings over time. Bergman encourages consistency in contributions, patience in investing, and trust in the retirement savings process to achieve financial security in retirement.

Furthermore, Mr. Bergman underscores the flexibility and opportunity for individuals to catch up on retirement savings by utilizing Solo 401(k) plans and the Mega Backdoor Roth strategy. He stresses the importance of starting contributions early, being consistent in saving, and investing wisely to build a substantial retirement fund. Bergman expresses optimism about the future growth of contribution limits due to inflation adjustments, providing individuals with increased opportunities to save more for retirement each year.

In conclusion, Bergman encourages listeners to consider the presented strategies for maximizing retirement contributions and emphasizes the potential for tax-free growth in retirement savings. He invites feedback, comments, and suggestions for future podcast topics while advocating for the shared goal of becoming tax-free millionaires in retirement. Bergman’s enthusiasm for retirement savings and the potential benefits of strategic contributions shine through in their discussion of leveraging Solo 401(k) plans and the Mega Backdoor Roth strategy for long-term financial success.


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