I have just recently started my own business as family child care provider (I do daycare in my home). I’ve got the families and the checks are starting to come in. Now I need guidance with what to do with the money.
Our current retirement contributions look pretty sad:
- Husband’s 401k – $3,600 annually (no company match offered)
- Husband’s Roth IRA – currently maxed
- I was a teacher for a number of years then made the decision to stay home when we had kids. I have some money sitting in a 403B account from my teaching days, but no 401k or IRA to speak of.
As we already know we can live happily on my husband’s income alone, our current plan is to take all my earnings (minus what we’ll need for taxes and business expenses) and dump it straight into a retirement vehicle. We estimate that’ll be between 27-29k annually of new retirement money (expenses and taxes already considered).
What should we do with this 27-29K?
Can I open a one-participant 401k plan? If so, how do I do that? Can I contribute over the $17,500 if my ‘business’ contributes as well? I have no employees.
We have 100,000 left on our mortgage, which based on our current rate of pay, we anticipate will be paid off in 7 years.
Apart from the possible addition of another child, we don’t anticipate any significant expenses in our future.
Thank you for any and all help!