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Self-Employed 401(k) Plans

Self-employed individuals and owner-only businesses and partnerships can save more for retirement through a 401(k) plan designed especially for them.

Plan features

Tax benefits

Tax-deferred growth

Tax-deductible contributions

Pre-tax employee deferral contributions

Learn more about the tax advantages of self-employed 401(k)s.

No setup or annual account fee1


Self-employed individuals and owner-only businesses and partnerships are eligible.

Owners’ spouses may also participate.

IRS maximum

Salary deferrals up to $17,500 for 2014 and $18,000 for 2015

See how much you may be able to contribute to your plan with our Self-Employed Contribution Calculator.

Catch-up contribution

Additional salary deferral of $5,500 for 2014 and $6,000 for 2015 (if age 50 or older)2

Profit sharing

Up to 25% of compensation,3 up to the annual maximum of $52,000 for 2014 and $53,000 for 2015

Establishment deadline

The deadline to open a new plan is December 31 (or fiscal year-end).


Annual IRS Form 5500 filing after plan assets exceed $250,000


Minimum required distributions starting at age 70½

10% early withdrawal penalty if under age 59½ and no exceptions apply

Investment options

A wide range of mutual funds, stocks, bonds, ETFs, and FDIC-insured CDs

Support and guidance

One-on-one guidance—in person, online, or over the phone

Research and tools to help you create a long-term plan and choose investments

Next steps

Open a Self-Employed 401(k).
Call 800-544-5373 and select option 3 to speak with a small-business retirement specialist.

Get started on your own. Get a jump on the paperwork for your new plan.
Rated 4.1 out of 5 by 115 reviewers.
Rated 4 out of 5 by Super fast self employed 401K setup Fidelity helped me setup a self employed 401K plan within no time. The paperwork was minimal and within 30 mins, my account was ready. They were very helpful in explaining how contributions can be made along with limits etc. September 20, 2013
Rated 1 out of 5 by 401(k) Solo Fidelity Solo 401(k) plan is set up as a Keogh plan and this will not allow access to loans. I found this out the hard way. The plan documents do not allow the loan. When I set up the account with Fidelity this was one of the major objectives was to have the safety of a plan loan. I was told by a fidelity rep that is was available. He was wrong. If you are setting up a Solo 401(k) and want a loan don 't use Fidelity. September 18, 2013
Rated 5 out of 5 by 401k Fidelity advisors were all well versed in the investment product, were very cordial and helpful. Answered all my questions & more. May 27, 2013
Rated 3 out of 5 by Service. A phrase not a reality! In early January 2013 I called with questions about Roth 401k plans. I was transferred around and talked to 3 different people who said that they were not the right person. It was a waste of time. February 23, 2013
Rated 4 out of 5 by self employed owner My main issue is reporting. You never furnish accounting by year as to the EE contri. and the company's contribution by acct. year. You sent out forms for plan contributions, but nothing to help us out on how much we have put in or how much we can put in. I manage 5 other Trad. IRA and Roth IRA's for our family and the same thing that I mentioned above applies to each one of them. February 22, 2013
Rated 3 out of 5 by Awful statement reporting of fixed rate CD earnings Overall, the account and service is okay. However, the way you report the earnings on fixed rate CD investments on statements is absolutely awful as I have documented to you in calls and comments many times. This is why I will probably close and move my account when the up-coming matuturity dates are satisfied. February 21, 2013
Rated 4 out of 5 by Flexibility and Choice The Self-Employed 401(k) generally meets my needs in terms of ease of use and flexibility of the account. The two minor issues that I have regarding convenience of the account include the requirement to visit a branch to deposit money and the ability to trade on multiple stock exchanges. In the age of the Internet it seems absurd that one would have to visit a branch to deposit money into the account, instead of being able to move it by electronic means. Secondly, the self-employed 401(k) is, not surprisingly, focused on the US stock markets when there are myriad other opportunities out there. Trading on other stock exchanges isn't easy, if even possible. February 20, 2013
Rated 4 out of 5 by SE 401k It is pretty good, but would be nice if there was a ROTH 401k option. February 20, 2013
Rated 5 out of 5 by Ease of investing The Fidelity account is very easy to maintain and offers numerous investing options. February 19, 2013
Rated 5 out of 5 by Easy and flexible The account was easy to set up as there was little paperwork required and Fidelity handled everything quickly. It is easy to manage the account. Deposits are a breeze. There are many investment options as it behaves like a brokerage account. I'm glad I have the account and I'm glad that Fidelity manages it! February 18, 2013
Rated 1 out of 5 by I have no idea what you mean here You may think I have a self-employed 401K but beyond a few initial recommendations, which I ended up changing, I receive no additional services from Fidelity. I do have an account for my self-employed 401K but it really is managed by me. So short of holding it for me, there is nothing "designed" for me. February 18, 2013
Rated 4 out of 5 by Easy to use Low cost, easy to use account for our business. The only thing that would improve the account for us would be the option of a Roth. February 18, 2013
Rated 4 out of 5 by Secure and Reliable I have been using it for the past 3 years and I like everything about it . The only bad thing is that you cannot do a direct transfer of funds into the account. February 18, 2013
Rated 5 out of 5 by Easy to Use, Convenient, and Flexible Having a Fidelity self-employed 401K has given me the opportunity to manage my investments as much or as little as I please. I can invest in mutual funds, ETFs, equities, options etc backed by the research which Fidelity offers. Moving money from one asset to another couldn't be easier and I can add money to my account through the mail or at my local Fidelity location for quicker deposit. This works for my schedule and availability. February 18, 2013
Rated 4 out of 5 by Awesome tool to save for retirement I love the fact that there is a profit-sharing as well as an employee contribution component to this plan. Since i am a sole proprietor, that means i can max out my plan for saving more towards retirement. My only peeve is that i have to mail my contribution check or go to a local center to contribute money to this plan, rather than wiring money from my bank account. It would be great if Fidelity can arrange a money line so that investors can directly funnel funds into the 401K account. February 18, 2013
Rated 4 out of 5 by Good Support Account access is easy through the web. Tax related documents well defined. Would be nice to have a "Stable Value" fund investment option similar to company 401k plans. February 17, 2013
Rated 4 out of 5 by President Other Brokerage/Investment services, allow for monthly contributions to be automaticly transferred from company checking account to 401k account.. In using the same your location in Naperville, I receive inconsistent service when I make my monthly contribution. Sometimes there is confusion on the part of the employee on how to process the contribution even though I hand in the same paper documentation month to month. February 17, 2013
Rated 5 out of 5 by Recommended to all my clients This is the best value out there for small 401(k) plans. I am a CPA. I use the plan for my own small business and regularly recommend it to all my small business clients. February 16, 2013
Rated 5 out of 5 by excellent if you want to manage your account very happy and comfortablr with the account as manage it on our own February 16, 2013
Rated 5 out of 5 by Fidelity Self-Employed 401(k) I use this account for my self-employed 401k savings. I really like the research material available on the Fidelity website, plus the low cost trades. The iPad and iPhone apps are awesome, and I use the stock price alerts to let me know when a stock I want is in my target price range. I wish they had a way for me to automatically debit my business checking account to transfer my contributions into my Fidelity account instead of mailing in a check. February 16, 2013
Rated 5 out of 5 by Excellent account Fidelity helped me set up my 401k when I was in a rush to do it before Dec. 31. They were the only retirement service with a boilerplate application form to set it up; other services were happy to have my account once it was set up but couldn't help me set one up. The investment options and help in moving monies around are excellent. February 16, 2013
Rated 1 out of 5 by unable to do risk management Because short-term trading of mutual funds are too expensive here. It is difficult to trade and do risk management with Fidelity. February 16, 2013
Rated 5 out of 5 by Simple and easy to use --an easy format for 401K. I find the analysis of limited usefulness and somewhat confusing. The other complaint is not being able to track purchases and sales of mutual funds once the order is given for several days, so I don't know if the trade has gone through. Overall, the online program is user-friendly. February 16, 2013
Rated 4 out of 5 by Roth Needs to be Added Great service, investment options and reports. Wish a Roth option was avaiable. February 16, 2013
Rated 5 out of 5 by Fidelity Self-Employed 401(k) is a solid product I set my plan up approximately 9 years ago, when I became self-employed. I have complete control over the portfolio, pay no annual fee, benefit from high contribution limits, and can buy just about any investment instrument on the market. Having to physically mail a check to the plan is a mild inconvenience, but I think this may have recently been addressed to allow other methods of fund transfer. It would be great if I could borrow against the 401(k) but that would be highly unusual for a non-employer sponsored plan. Overall, then, a great product which nicely meets my needs as a self-employed individual. February 16, 2013
Rated 4 out of 5 by Convenient with Lots of Options My Self-Employed 401K has turned out to be a great way to shelter some of my self-employed income. Fidelity offers a wide variety of investment choices. The only improvement I can think of would be for Fidelity to offer a more convenient way of depositing new money into the account. February 16, 2013
Rated 5 out of 5 by Year end Can you make IRS reprting simpler? Tell me what I need to file and when, and send me the form to fill out, or provide a link to it; ie: Form 5500, etc. February 16, 2013
Rated 4 out of 5 by jaa review secure and also fairly assessed. Good value and will continue to use Fidelity February 16, 2013
Rated 5 out of 5 by Efficient and Reliable I am a CPA running a one man practice set up as a corporation. I established this plan a little over seven years ago and it suits my circumstances just fine. I have also recommended this type of plan to clients of mine. For the future, I am curious to find out if there is a way to remit my periodic elective deferral contributions and year-end profit-sharing contribution electronically via the internet at the Fidelity website. Also, I was wondering if this type of plan can be amended to allow for ROTH 401(k) elective deferrals. February 16, 2013
Rated 4 out of 5 by Needs ROTH option The Self-Employed 401k plan should give the employee the option of making non-deductible ROTH contributions. February 16, 2013
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Although consultations are one on one, guidance provided by Fidelity is educational in nature, is not individualized, and is not intended to serve as the primary or sole basis for your investment or tax-planning decisions.
Note that the total of salary deferrals and profit sharing contributions cannot exceed $52,000 ($57,500 if age 50 or older) for 2014 and $53,000 ($59,000 if age 50 or older) for 2015.
1. There is no cost to open and no annual fee for Fidelity's Traditional, Roth, SEP, and Rollover IRAs. A $50 account close out fee may apply. Fund investments held in your account may be subject to management, low balance and short term trading fees, as described in the offering materials. For all securities, see the Fidelity commission schedule for trading commission and transaction fee details.
2. With catch-up provisions, individuals 50 and older may defer up to $23,000 in 2014 and $24,000 for 2015, subject to the combined deferral and employer contribution limit.
3. Maximum compensation on which contributions can be based is $260,000 for 2014 and $265,000 for 2015. If you are self-employed, compensation means earned income.
For further information on your specific situation, consult with your tax advisor.
The initial customer ratings and reviews for this product (those dated before 3/18/2013) were provided to Fidelity through an email solicitation for feedback on the product. All ratings and reviews are provided to Fidelity on a voluntarily basis and are screened in accordance with the guidelines set forth in our Customer Ratings and Reviews Terms of Use. For additional information on which ratings and reviews may be posted, please refer to our Customer Ratings and Review Terms of Use. Featured Reviews have been selected based on subjective criteria and reviewed by Fidelity Investments. The average rating is determined by calculating the mathematical average of all ratings that are approved for posting per the Customer Ratings and Reviews Terms of use and does not include any ratings that did not meet the guidelines and were therefore not posted. Ratings and reviews are added continuously to the website (after a delay for screening against guidelines) and average ratings are updated dynamically as reviews are added or removed.
The ratings and experience of customers may not be representative of the experiences of all customers or investors and is not indicative of future success. The accuracy of information included in the customer ratings and reviews cannot be guaranteed by Fidelity Investments. Customers who post ratings may be responsible for disclosing whether they have a financial interest or conflict in submitting a rating and review.
Please contact a Fidelity representative if you have additional questions or concerns about the ratings and reviews posted here.

Tax Advantages of Self-Employed 401(k)s

A Self-Employed 401(k) may substantially reduce your current income taxes because generally, you can deduct the entire amount of your plan contributions from your taxable income each year.

  • If your business is unincorporated, you can deduct contributions for yourself from your personal income.
  • If your business is incorporated, you can generally deduct contributions as a business expense.
  No Plan Self-Employed 401(k)
Net Business Profits $100,000 $100,000
Less Deduction for ½ Self-Employment Tax -7,065 -7,065
Less Max. Contribution (25% of earned income)3 -0 -18,587
Less Salary Deferral -0 -17,000
= Taxable Income = $92,935 = $57,348
Taxes Due4 $19,937 $11,256
Taxes Saved $0 $8,681

How a Self-Employed 401(k) contribution can add up

As you can see from the example below, for 2012 a self-employed business owner who is age 50 with $100,000 in compensation may save up to $20,500 more with a Self-Employed 401(k) than with a SEP-IRA or Profit Sharing Plan.

2012 Example No Plan Self-Employed 401(k)
Employer's Tax Deductible Contribution Up to 25%3 of compensation (not to exceed $50,000) $18,587 $18,587
(25% x $74,348)
Employee's Deferral Option (not to exceed $17,000) Not applicable $17,000
Employee's Catch-Up Deferral Option if age 50 or older (not to exceed $5,500) Not applicable $5,500
Final Total Contribution $18,587 $41,087

Note: Fidelity also offers a Profit Sharing Plan which lets you contribute the same amount as a SEP-IRA. A Profit Sharing Plan may be better suited for your needs if you have multiple employees and want more restrictive eligibility requirements to participate in the plan. Please contact a Fidelity retirement representative at 800-544-5373 and select option 3 for more information.