Self-employment doesn’t necessarily mean you can’t get the same benefits from an employee-sponsored 401k plan that you would get if you worked full-time at a company. For those who choose to be their own boss, there’s something called a solo 401k, which is specifically designed for self-employed people who don’t have employees.
The individual 401k offers a huge tax relief for entrepreneurs and is an excellent option to save and invest for retirement. Most discount brokers offer free individual 401k plans, but these brokers limit the types of investments.
Self-employed individuals looking to invest in alternatives such as crypto, real estate or gold and silver should look to specialist firms to open self-directed individual 401k accounts.
Today we are reviewing The Nabers Group, which offers a fixed fee, self-directed 401k account that allows you to access all kinds of alternative investments. We explain how it works and whether it makes sense to open one.
Self-directed individual 401k that allows the self-employed to invest in almost anything. Traditional and Roth contributions are allowed. Lend yourself up to $50,000. Fixed monthly amount for all account holders. Debit cards are designed with kids in mind Parents can set store-specific spending limits Rewards on savings plus the ability to add interest paid by parents
Solo 401k by Nabers Group Details
Solo 401k by Nabers Group
Fixed monthly fee of $49
No start-up costs
Unlimited Cost Rollovers
What is the Solo 401k from Nabers Group?
The Solo 401k from the Nabers Group is a self-driving 401k for the self-employed and their spouses. With a solo 401k account, account holders can invest in almost any asset class, including gold and silver, mortgage notes, real estate, and other asset classes that most people don’t have access to through their retirement accounts.
The Nabers Group has been offering self-driving 401k products since 2006, just a few years after individual 401k’s became more popular due to changes in law. The fixed monthly fee for the product includes access to a variety of legal templates to ensure your investments remain legally compliant.
What does it offer?
The Nabers Group offers a Solo 401k, designed for self-employed without staff. Investors can opt for conventional investments such as shares and bonds, but the Nabers Groep also makes alternative investments possible.
Invest in almost any type of asset
The Solo 401k from Nabers Group is a self-driven 401k plan for the self-employed. It allows investors to make tax-advantaged investments in alternative asset classes, such as:
LoansSyndicated Real EstateReal EstateHedge FundsCryptocurrencyBullionPrivate CompaniesOther Passive InvestmentsNabers Group clearly explains the rules of self-directed investment, but investors are responsible for getting legal advice if they operate in a gray area.
Fixed monthly fee for administration
People who choose to open a Solo 401k through Nabers Group pay a monthly fee of $49. The fee does not change depending on the complexity of your investments or the size of your account balance.
Regular educational webinars
The Nabers Group offers weekly educational webinars to give investors more clarity on how best to use their self-directed 401k account. These webinars complement one-on-one support for those who need it.
No installation costs
There are no start-up fees for new account holders. Account holders can roll over existing balances or make new deposits to fund the account. Plan participants never pay a fee to deposit money into the account.
Up to $50,000 Wallet Loan
Plan participants who have cash in their wallets can use up to half of it as a 401k loan. The maximum loan amount is $50,000. The interest payment on this loan is the Prime Rate + 1%. So, as an example, a person with $80,000 in cash can lend themselves $40,000. The remaining $40,000 can be invested after the loan is provided.
Nabers Groep handles annual paperwork
The Nabers Group creates IRS-approved 401k configuration documents and generates IRS Form 5500-EZ for account holders. The company also provides account holders with templates for 401k loans and other common transactions.
Roth option available
The account offers the opportunity for Roth contributions and in-plan Roth conversions. With Roth conversions on schedule, account holders can convert some or all of their pre-tax contributions into Roth contributions that are not re-taxed. Account holders must pay the tax on the converted funds in the year the money is converted into a Roth holding company. This can be advantageous for self-employed persons with a low income year.
Are there any costs?
The Nabers Group charges all customers a flat monthly fee of $49.
This fee covers the costs of:
Account administration including ongoing plan maintenance and support Unlimited fee rolloversBank, brokerage and crypto account accessForm 5500-EZ preparation One-click annual IRS maintenance
How do I get in touch with the Nabers group?
The Nabers Group is based in Scottsdale, Arizona, but serves the self-employed in the United States. The best way to contact the Nabers Group is via the customer service number (877) 765-6401. The company also has a chatbot on its webpage.
How does Nabers Group compare?
Major brokers like Fidelity, Vanguard, and Charles Schwab offer free solo 401k plans for qualified people. However, the investments in these accounts are limited to stocks, bonds, ETFs and mutual funds. For most people, these free accounts are fine. But those who want to be self-directed will have to pay their investments for that option. Self-direction simply means that investors want access to alternative investments and complete control over buying and selling decisions.
Compare the most popular Solo 401k providers
Those who opt for the Nabers Groep pay a higher monthly amount for the option to manage their investments as they see fit. However, they will have virtually unlimited investment opportunities at their disposal. The rates of the Nabers Group are slightly higher than those of direct competitors such as Rocket Dollar and Alto. These companies sometimes charge one-time start-up costs, but otherwise offer similar services as the Nabers Group. Based on the price difference, investors should choose one of the cheaper alternatives.
Note: Nabers Group charges their fees on a monthly basis, estimated at $49 per month.
How do I open an account?
To open a Solo 401k through the Nabers Group, you need to apply quickly online. The application ensures that you are qualified to open a Solo 401k subscription. If so, the Nabers Group will create plan documents for the person. Once that is done, investors should set up a deposit account for their investments.
The Nabers Group has ‘preferred banks’ that help investors set up IRS-compliant checking accounts. Once that is done, investors can start transferring funds or assets into the account and investing can begin.
Is it safe and secure?
The Nabers Group has robust security and privacy policies designed to keep information and assets safe. Investors pay for their bills using Stripe, a secure payment portal. All of a person’s account and personal information is encrypted in transit and at rest.
Investments and cash for investments are not held by the Nabers Group, so these assets are theoretically quite safe (especially those with banks or brokers).
Overall, the security protocols seem robust and investors can invest with confidence.
Is it worth it?
Self-employed people usually don’t need a nice, self-driven 401k. Their retirement investments likely include standard ETFs and mutual funds. Few people want to put their retirement money into speculative investments.
However, some people have the specific knowledge to be able to invest in alternative assets such as gold, silver, real estate or promissory notes. These investors may want to combine an alternative investment strategy with the tax benefits of a solo 401k.
The product makes sense for self-employed people looking for alternative investments. However, it is not a cheap leader. Investors should look to cheaper alternatives before opting to go with the Nabers Group for their self-driven Solo 401k.
Solo 401k by Nabers Group Features
Managed (Robo-Advisor) Portfolios
Bitcoin and other cryptocurrenciesReal EstatePrecious MetalsTraditional investments such as stocks, bonds and publicly traded funds
Monday-Saturday, 8:00 AM – 11:00 PM (MT)
Sunday by appointment
Web/Desktop Account Access
This post Solo 401k by Nabers Group Review 2022
was original published at “https://thecollegeinvestor.com/39785/solo-401k-by-nabers-group-review/”