Lost 401K, can I start a company that can gives me individual 401K?

[astvilla]

Background:

Company I worked for that gave 401K for part-time work closed.  Now I can't contribute into one because new job doesn't offer that for part-time employees.  New job also doesn't offer as many hours or work so I'm paid less. 

I have a new potential offer with more possible future opportunities as a freelancer.  I spoke with Fidelity sometime ago, they said you can have an individual 401K.  But to do that, I would need to open my own company (which I have no experience in or ever done).  Through my own "company", the revenue it makes (very little thousands at most) I can make my own 401K.  Is this true and is it worth it?  Wouldn't I have to pay some fees just to enter into a 401K or just the fees of the fund?

Also the employer contract states it won't "withold any income tax or other payroll deduction".  I have to do that.  Is this different than most jobs where people get taxes, contributions deducted, than they get their take home pay?  It sounds like I get paid all up front and have to do my own taxes and states I have to report income and taxes to appropriate tax authorities. I'm still filling out a W-9 (for freelance work?).  How does reporting my own work?  Sounds like instead of tax refunds, it'd be tax owe...theoretically.

Can I set up where the employer pays into company and I give myself a 401K instead of paying to me directly?  Is it legal? Are there better alternatives? (I already maxed Roth this year).

Thank you.

[Roboturner]

Background:

Company I worked for that gave 401K for part-time work closed.  Now I can't contribute into one because new job doesn't offer that for part-time employees.  New job also doesn't offer as many hours or work so I'm paid less. 

I have a new potential offer with more possible future opportunities as a freelancer.  I spoke with Fidelity sometime ago, they said you can have an individual 401K.  But to do that, I would need to open my own company (which I have no experience in or ever done).  Through my own "company", the revenue it makes (very little thousands at most) I can make my own 401K.  Is this true and is it worth it?  Wouldn't I have to pay some fees just to enter into a 401K or just the fees of the fund?

Also the employer contract states it won't "withold any income tax or other payroll deduction".  I have to do that.  Is this different than most jobs where people get taxes, contributions deducted, than they get their take home pay?  It sounds like I get paid all up front and have to do my own taxes and states I have to report income and taxes to appropriate tax authorities. I'm still filling out a W-9 (for freelance work?).  How does reporting my own work?  Sounds like instead of tax refunds, it'd be tax owe...theoretically.

Can I set up where the employer pays into company and I give myself a 401K instead of paying to me directly?  Is it legal? Are there better alternatives? (I already maxed Roth this year).

Thank you.

You would have to renegotiate your position to be a contract worker, rather than a W2 worker (if you aren't already), as you can only contribute up to what your "business" makes (18k+ 25% of whats left more or less). This however means you'd also have to pay SE tax (quarterly) sooooo you'd have to see if it makes sense for you

[Vilgan]

It sounds like your new position is a 1099 position rather than a w-2 position. This means you only get paid via contract and you aren't an employee and don't have any benefits etc. In addition to you having to withhold your own taxes, this also means that you'll have to pay things that an "employer" normally would like the employer portion of social security and medicare. I'd do some research on the differences so that you understand them.

As a result of getting paid 1099, you are already your own company. Its a sole proprietorship where your company name is your own personal name. You can do a solo 401k with fidelity and its free. I would recommend pursuing it if we are talking about more than 2k/year in income.

I would recommend googling and doing some research to understand your responsibilities when getting paid 1099. You will be (at least partially) self employed, have to do more tax related work, file a schedule C, etc. On the flipside, you can deduct some stuff as a business expense.

You should be also be paid more as a 1099 than as an employee because you are shouldering a lot of responsibility/tax burden that normally you would not have to as a w-2 employee.

[Roboturner]

It sounds like your new position is a 1099 position rather than a w-2 position. This means you only get paid via contract and you aren't an employee and don't have any benefits etc. In addition to you having to withhold your own taxes, this also means that you'll have to pay things that an "employer" normally would like the employer portion of social security and medicare. I'd do some research on the differences so that you understand them.

As a result of getting paid 1099, you are already your own company. Its a sole proprietorship where your company name is your own personal name. You can do a solo 401k with fidelity and its free. I would recommend pursuing it if we are talking about more than 2k/year in income.

I would recommend googling and doing some research to understand your responsibilities when getting paid 1099. You will be (at least partially) self employed, have to do more tax related work, file a schedule C, etc. On the flipside, you can deduct some stuff as a business expense.

You should be also be paid more as a 1099 than as an employee because you are shouldering a lot of responsibility/tax burden that normally you would not have to as a w-2 employee.

exactly, as an employee (W2) your company pays half your medicare/SS tax, so if you are a 1099, make sure youre grossed-up from your previous wages, as you are now responsible for all of it. But yes as a 1099 you can open your i401k - I did mine through Vanguard as a Sole-Prop (free EIN from IRS, not sure if it's necessary to open a 401k, but i think it is). Also apparently VG only allows you to open mutual funds in your i401k, which seems odd to me.

But a pretty sweet set-up, i was able to put 33k in there last year - rather than the 18k elsewhere, downside is i'm providing my own match, so no "free" money (other than the tax savings of course)

[astvilla]

It sounds like your new position is a 1099 position rather than a w-2 position. This means you only get paid via contract and you aren't an employee and don't have any benefits etc. In addition to you having to withhold your own taxes, this also means that you'll have to pay things that an "employer" normally would like the employer portion of social security and medicare. I'd do some research on the differences so that you understand them.

As a result of getting paid 1099, you are already your own company. Its a sole proprietorship where your company name is your own personal name. You can do a solo 401k with fidelity and its free. I would recommend pursuing it if we are talking about more than 2k/year in income.

I would recommend googling and doing some research to understand your responsibilities when getting paid 1099. You will be (at least partially) self employed, have to do more tax related work, file a schedule C, etc. On the flipside, you can deduct some stuff as a business expense.

You should be also be paid more as a 1099 than as an employee because you are shouldering a lot of responsibility/tax burden that normally you would not have to as a w-2 employee.

you got it.  I'm not an employee actually...sorry I wasn't clear...I'm not all familiar with all the tax jargon.   The contract says I'm not an employee.  But I could get more similar gigs...hopefully. 

Paraphrasing the contract, it says it's not an employment agreement or guarantee of assigned work for any specific period of time.  The relationships is "at will".  Understands not a full time Equivalent employee as defined by Dept of Labor...not eligible for benefits...etc.  Nor am I planning/expecting to be an employee.  This arrangement works fine if I can throw $$ into a 401K.

I think it's 1099 because on page 1 of the W-9, there's a lot of Form 1099-INT, DIV, MISC, B etc on the Purpose of Form. 

Haven't a clue I'm paid more or not, but it's not low per assignment. 40 hours of work would be over a grand I guess.

No clue where to start though...I can just call the brokerage, give my SS, tell them what's going on?  I'm guessing I need to fill out the W-9 a different way?  Or the W-9 is just for my employer and they don't need to know how I'm contributing to a i401k? It's asking about Business name (not sure I need) and federal tax classification C corporation, S corporation, Partnership, Trust/estate, LLC, Enter tax class, other, or individual/sole proprietor or single-member LLC (i think it's that one, can do i401k?

Just curious, why >$2K is it worth it?

exactly, as an employee (W2) your company pays half your medicare/SS tax, so if you are a 1099, make sure youre grossed-up from your previous wages, as you are now responsible for all of it. But yes as a 1099 you can open your i401k - I did mine through Vanguard as a Sole-Prop (free EIN from IRS, not sure if it's necessary to open a 401k, but i think it is). Also apparently VG only allows you to open mutual funds in your i401k, which seems odd to me.

But a pretty sweet set-up, i was able to put 33k in there last year - rather than the 18k elsewhere, downside is i'm providing my own match, so no "free" money (other than the tax savings of course)

Wait you can contribute more than >18K/year into a 401k??! I read something on employee deferral...is that why?

Thanks guys/gals...it's getting to be clearer. 

[Roboturner]

It sounds like your new position is a 1099 position rather than a w-2 position. This means you only get paid via contract and you aren't an employee and don't have any benefits etc. In addition to you having to withhold your own taxes, this also means that you'll have to pay things that an "employer" normally would like the employer portion of social security and medicare. I'd do some research on the differences so that you understand them.

As a result of getting paid 1099, you are already your own company. Its a sole proprietorship where your company name is your own personal name. You can do a solo 401k with fidelity and its free. I would recommend pursuing it if we are talking about more than 2k/year in income.

I would recommend googling and doing some research to understand your responsibilities when getting paid 1099. You will be (at least partially) self employed, have to do more tax related work, file a schedule C, etc. On the flipside, you can deduct some stuff as a business expense.

You should be also be paid more as a 1099 than as an employee because you are shouldering a lot of responsibility/tax burden that normally you would not have to as a w-2 employee.

you got it.  I'm not an employee actually...sorry I wasn't clear...I'm not all familiar with all the tax jargon.   The contract says I'm not an employee.  But I could get more similar gigs...hopefully. 

Paraphrasing the contract, it says it's not an employment agreement or guarantee of assigned work for any specific period of time.  The relationships is "at will".  Understands not a full time Equivalent employee as defined by Dept of Labor...not eligible for benefits...etc.  Nor am I planning/expecting to be an employee.  This arrangement works fine if I can throw $$ into a 401K.

I think it's 1099 because on page 1 of the W-9, there's a lot of Form 1099-INT, DIV, MISC, B etc on the Purpose of Form. 

Haven't a clue I'm paid more or not, but it's not low per assignment. 40 hours of work would be over a grand I guess.

No clue where to start though...I can just call the brokerage, give my SS, tell them what's going on?  I'm guessing I need to fill out the W-9 a different way?  Or the W-9 is just for my employer and they don't need to know how I'm contributing to a i401k? It's asking about Business name (not sure I need) and federal tax classification C corporation, S corporation, Partnership, Trust/estate, LLC, Enter tax class, other, or individual/sole proprietor or single-member LLC (i think it's that one, can do i401k?

Just curious, why >$2K is it worth it?

exactly, as an employee (W2) your company pays half your medicare/SS tax, so if you are a 1099, make sure youre grossed-up from your previous wages, as you are now responsible for all of it. But yes as a 1099 you can open your i401k - I did mine through Vanguard as a Sole-Prop (free EIN from IRS, not sure if it's necessary to open a 401k, but i think it is). Also apparently VG only allows you to open mutual funds in your i401k, which seems odd to me.

But a pretty sweet set-up, i was able to put 33k in there last year - rather than the 18k elsewhere, downside is i'm providing my own match, so no "free" money (other than the tax savings of course)

Wait you can contribute more than >18K/year into a 401k??! I read something on employee deferral...is that why?

Thanks guys/gals...it's getting to be clearer.

Yeah, employee deferral is your 18k, then you can "profit-share" something like 25% of the remaining money after SE taxes or some such (you can use a handy-dandy calculator by googling "i401k calculator") then in VG you deposit and select whether it's an employee or employer contribution. Limits on what you make for your "business" of course - up to 55k or so, but to hit that you'd need to pull something like 250k/yr.

One of the reasons people choose i401k over SEP and others - higher contribution limits

[Roboturner]

oh also be aware (i keep harping on it because i didn't realize for my first year) you have to pay quarterly estimated taxes which, over the year need to gross up to at least 90% of your total income tax due for the year, or more than what you owed last year (which ever is lower) - otherwise you get penalized by the gubmint (you can think of this like W2 withholding)

but as Vilgan said earlier, you can write off legit biz expenses, like if you buy a new comp for primarily work, or have a home office, or use a % of your cell for work etc, which is nice

EDIT: clarity - Thanks MDM

[Vilgan]

Limits on what you make for your "business" of course - up to 55k or so, but to hit that you'd need to pull something like 250k/yr.

This is a bit off topic, but the 53k business cap on a 401k is pretty easy to hit at much lower salary levels if you make a custom solo 401k. That's more complex and isn't free, but can be well worth it to dump more $$ into tax sheltered. See http://thefinancebuff.com/after-tax-contributions-in-solo-401k.html

[Heckler]

Do I understand it correctly that Uncle Sam doesn't allow you to save for retirement on a tax deferred basis unless your employer offers a 401k?   

Here in the cold north, anyone can walk into a bank and open an RSP which has the same tax limitations and benefits as an employer sponsored RSP plan. 

[MDM]

Do I understand it correctly that Uncle Sam doesn't allow you to save for retirement on a tax deferred basis unless your employer offers a 401k?   

Here in the cold north, anyone can walk into a bank and open an RSP which has the same tax limitations and benefits as an employer sponsored RSP plan.

In brief:
 - Anyone (including people covered in the next point) may open an IRA (Individual Retirement Arrangement) with a $5500/yr contribution limit.
 - 401k plans (offered by private employers) and 403b plans (offered by non-profit, e.g. school, employers) have an $18000/yr contribution limit

There are additions and exceptions to the above, but that's the short version.

[astvilla]

oh also be aware (i keep harping on it because i didn't realize for my first year) you have to pay quarterly estimated taxes which, over the year need to gross up to at least 90% of your income for the year, or more than what you owed last year (which ever is lower) - otherwise you get penalized by the gubmint (you can think of this like W2 withholding)

This sounds scary.  My tax has to be 90% of my income?! I'm having a hard timing imagining this.

Yeah EIN is mandatory for Vanguard, so I'm applying for one online.

All this is sorta confusing, I don't want to step over any boundaries or break any tax laws by accident, or end up paying more and having a net loss just to invest than it's worth.  The tax sounds really high to do this. But I guess that's why I'm paid more? 

As a result of getting paid 1099, you are already your own company. Its a sole proprietorship where your company name is your own personal name. You can do a solo 401k with fidelity and its free. I would recommend pursuing it if we are talking about more than 2k/year in income.

I'm still wondering about this.  What happens if it isn't? Maybe the fees not worth it?  In Vanguard, they say it's $20/fund/year + the ER, so not too many funds...which is fine w/me.

[Roboturner]

oh also be aware (i keep harping on it because i didn't realize for my first year) you have to pay quarterly estimated taxes which, over the year need to gross up to at least 90% of your income for the year, or more than what you owed last year (which ever is lower) - otherwise you get penalized by the gubmint (you can think of this like W2 withholding)

This sounds scary.  My tax has to be 90% of my income?! I'm having a hard timing imagining this.

no no no, you need to pay 1/4 of 90% of the total tax bill for the year every quarter.

in that, if you make 100k and have to pay 30k in taxes in April, you should pay .25*.9*$30k ($6,750) every quarter

[MDM]

oh also be aware (i keep harping on it because i didn't realize for my first year) you have to pay quarterly estimated taxes which, over the year need to gross up to at least 90% of your total income tax due for the year, or more than what you owed last year (which ever is lower) - otherwise you get penalized by the gubmint (you can think of this like W2 withholding)

This sounds scary.  My tax has to be 90% of my income?! I'm having a hard timing imagining this.

Is the edited quote less scary?  Because that is what Roboturner meant....

[Roboturner]

Uncle Sam just wants to make sure that you don't forget about paying your taxes, especially because there is no "federal withholding" like there is in a W2. So they instituted a pay estimated taxes on a quarterly basis for businesses. Just google Sole prop - quarterly taxes, you'll get the idea. I was just bringing up that I hadn't realized that I couldn't just pay a lump sum at the end of the year without getting penalized - got to break it up by quarter.

[Roboturner]

oh also be aware (i keep harping on it because i didn't realize for my first year) you have to pay quarterly estimated taxes which, over the year need to gross up to at least 90% of your total income tax due for the year, or more than what you owed last year (which ever is lower) - otherwise you get penalized by the gubmint (you can think of this like W2 withholding)

This sounds scary.  My tax has to be 90% of my income?! I'm having a hard timing imagining this.

Is the edited quote less scary?  Because that is what Roboturner meant....

hahaha thanks, edited former statement, missed that!

[Stairway to Stache]

Instead of a solo 401k which can have expensive administrative fees and be more work to manage, take a look at setting up a SEP IRA through Vanguard. Especially if your business you establish is not earning a lot yet, the simpler, cheaper and easier option would be a SEP. Contribution limits are different, as you are setting aside a % of income with a SEP but you can still stash a lot, up to the same maximum as a 401k 54,000 depending on your income. Here is an older article from Forbes that may give you some more ideas on the possibilities and possibly the costs, which can be anywhere from 1-2k for administrating your plan if you do a 401k. I suggest researching both to see what would work best for your situation.
http://www.forbes.com/sites/ashleaebeling/2013/02/13/how-entrepreneurs-can-get-big-tax-breaks-for-retirement-savings/#54033cc7625739b54b3e6257

[astvilla]

Instead of a solo 401k which can have expensive administrative fees and be more work to manage, take a look at setting up a SEP IRA through Vanguard. Especially if your business you establish is not earning a lot yet, the simpler, cheaper and easier option would be a SEP. Contribution limits are different, as you are setting aside a % of income with a SEP but you can still stash a lot, up to the same maximum as a 401k 54,000 depending on your income. Here is an older article from Forbes that may give you some more ideas on the possibilities and possibly the costs, which can be anywhere from 1-2k for administrating your plan if you do a 401k. I suggest researching both to see what would work best for your situation.
http://www.forbes.com/sites/ashleaebeling/2013/02/13/how-entrepreneurs-can-get-big-tax-breaks-for-retirement-savings/#54033cc7625739b54b3e6257

Oh okay but the plan administration costs don't seem anywhere near that high according to Vanguard.

From my discussion w/Vanguard, they said there's a $20/fund/year fee but that is waived in an i401k if you're a Voyager client (50K invested).  In their SEP IRA, there's 3 ways, Voyager client, >10K in each fund, or sign up for e-delivery instead of paper.  The SEP IRA also has more options (stocks, Admiral funds) while the i401k is only investor class shares, even if you meet the minimum for admiral, you still pay investor class shares and their ER.  It sounds pretty cheap as long as you keep the i401k limited to a few funds.

i401k is more complex, harder to set up (paper mail only), needs EIN, simpler, easier whereas SEP IRA can be done electronic, over the phone, more flexible trading options, same fees, just more and easier ways to waive them. 

I'm leaning towards the i401k, because if you make >$265,000 it doesn't matter which one you pick, you'll hit the limit of 53K.  But some people are okay with 20% income into retirement, I want more, so I'm going w/i401k.  I'll hit their Voyager status soon so I'm not concerned about fees.  The only concern I'd have is the ER for investor class vs admiral in SEP IRA, but I'm not keeping this account for 30-40 years.

oh also be aware (i keep harping on it because i didn't realize for my first year) you have to pay quarterly estimated taxes which, over the year need to gross up to at least 90% of your total income tax due for the year, or more than what you owed last year (which ever is lower) - otherwise you get penalized by the gubmint (you can think of this like W2 withholding)

This sounds scary.  My tax has to be 90% of my income?! I'm having a hard timing imagining this.

Is the edited quote less scary?  Because that is what Roboturner meant....

hahaha thanks, edited former statement, missed that!

Lol thanks MDM and Roboturner for that clarification.

[Stairway to Stache]

Its not the 401k's plan fees that will necessarily be excessive, its having to pay for and find the services of a third party administrator or "TPA" for the plan(s) which you will need to keep your plan in compliance. The 3rd party administrator handles your regulatory filings, compliance paperwork and other administrative tasks to ensure your plan follows all of the rules and regulations for ERISA, 401ks, etc. This is separate from a Vanguard or Fidelity which would be the custodian that holds and helps manage your money. This is where if you are not stashing the maximum it may be worth looking at a different, overall cheaper option but if you are stashing a larger amount, in the 20-54k range than it is probably worth it going the 401k route and if you want to set up a defined benefit plan as well you will need these same services. The key here is to just remember to take into account the total cost of whichever route you go with

[astvilla]

Its not the 401k's plan fees that will necessarily be excessive, its having to pay for and find the services of a third party administrator or "TPA" for the plan(s) which you will need to keep your plan in compliance. The 3rd party administrator handles your regulatory filings, compliance paperwork and other administrative tasks to ensure your plan follows all of the rules and regulations for ERISA, 401ks, etc. This is separate from a Vanguard or Fidelity which would be the custodian that holds and helps manage your money. This is where if you are not stashing the maximum it may be worth looking at a different, overall cheaper option but if you are stashing a larger amount, in the 20-54k range than it is probably worth it going the 401k route and if you want to set up a defined benefit plan as well you will need these same services. The key here is to just remember to take into account the total cost of whichever route you go with

Interesting point, but you could designate yourself as the third party administrator no?  That's what it seems like in the Vanguard form.

[terran]

Its not the 401k's plan fees that will necessarily be excessive, its having to pay for and find the services of a third party administrator or "TPA" for the plan(s) which you will need to keep your plan in compliance. The 3rd party administrator handles your regulatory filings, compliance paperwork and other administrative tasks to ensure your plan follows all of the rules and regulations for ERISA, 401ks, etc. This is separate from a Vanguard or Fidelity which would be the custodian that holds and helps manage your money. This is where if you are not stashing the maximum it may be worth looking at a different, overall cheaper option but if you are stashing a larger amount, in the 20-54k range than it is probably worth it going the 401k route and if you want to set up a defined benefit plan as well you will need these same services. The key here is to just remember to take into account the total cost of whichever route you go with

Interesting point, but you could designate yourself as the third party administrator no?  That's what it seems like in the Vanguard form.

This may have been true at some point, but Vanguard, Fidelity, e-trade, TD Ameritrade, and possibly others all act as third party administrators for free. The application may be a little longer than a SEP, and once you have more than $250k in the account there is an annual filing requirement, but I see no reason to go with a SEP over a solo 401k as the latter has a much higher contribution limit until you reach a high income, at which point they're the same and the SEP will mess up a backdoor roth.

[dandarc]

Instead of a solo 401k which can have expensive administrative fees and be more work to manage, take a look at setting up a SEP IRA through Vanguard. Especially if your business you establish is not earning a lot yet, the simpler, cheaper and easier option would be a SEP. Contribution limits are different, as you are setting aside a % of income with a SEP but you can still stash a lot, up to the same maximum as a 401k 54,000 depending on your income. Here is an older article from Forbes that may give you some more ideas on the possibilities and possibly the costs, which can be anywhere from 1-2k for administrating your plan if you do a 401k. I suggest researching both to see what would work best for your situation.
http://www.forbes.com/sites/ashleaebeling/2013/02/13/how-entrepreneurs-can-get-big-tax-breaks-for-retirement-savings/#54033cc7625739b54b3e6257

Says the guy who hasn't actually researched soloKs and probably not SEP IRAs or SIMPLEs either.  Certainly not recently.  Many brokerages offer no-fee Individual 401K's now.

And a business that isn't earning a lot is what the soloK is designed for - you can defer much more at lower incomes in a soloK than a SEP IRA.

Now, if OP might have employees one day, that's another ball of wax, but that problem doesn't go away by having a SEP IRA either.

[Vilgan]

Instead of a solo 401k which can have expensive administrative fees and be more work to manage, take a look at setting up a SEP IRA through Vanguard. Especially if your business you establish is not earning a lot yet, the simpler, cheaper and easier option would be a SEP. Contribution limits are different, as you are setting aside a % of income with a SEP but you can still stash a lot, up to the same maximum as a 401k 54,000 depending on your income. Here is an older article from Forbes that may give you some more ideas on the possibilities and possibly the costs, which can be anywhere from 1-2k for administrating your plan if you do a 401k. I suggest researching both to see what would work best for your situation.
http://www.forbes.com/sites/ashleaebeling/2013/02/13/how-entrepreneurs-can-get-big-tax-breaks-for-retirement-savings/#54033cc7625739b54b3e6257

Says the guy who hasn't actually researched soloKs and probably not SEP IRAs or SIMPLEs either.  Certainly not recently.  Many brokerages offer no-fee Individual 401K's now.

And a business that isn't earning a lot is what the soloK is designed for - you can defer much more at lower incomes in a soloK than a SEP IRA.

Now, if OP might have employees one day, that's another ball of wax, but that problem doesn't go away by having a SEP IRA either.

+1 to everything dandarc said, I think fols is either out of date or was misinformed at some point.

[RedmondStash]

I'd recommend a SEP-IRA for simplicity. You can put a lot more into that than you can into a tIRA or Roth IRA; it's based on a percentage of income, not a global limit of $5,500. You can Google some calculators for info about how much you can contribute for your income level.

And here's some information about paying federal estimated quarterly taxes:

https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Estimated-Taxes
https://www.irs.gov/pub/irs-pdf/f1040es.pdf

It can be confusing navigating the 1099-MISC world where you're an independent contractor or freelancer instead of an employee. You may have to set up a business of some sort (sole proprietor works fine), and you have to keep an eye on any required state taxes too. For example, in Washington State, regular employees don't pay state income tax, but freelancers who own their own businesses do. Go figure.

I'd personally put all the money you can into tax-advantaged retirement accounts, as long as you're pretty sure you won't need to touch it before you're 59.5. Even if you do, there are ways; other threads in this forum address them.

[dandarc]

I'd recommend a SEP-IRA for simplicity. You can put a lot more into that than you can into a tIRA or Roth IRA; it's based on a percentage of income, not a global limit of $5,500. You can Google some calculators for info about how much you can contribute for your income level.

And here's some information about paying federal estimated quarterly taxes:

https://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Estimated-Taxes
https://www.irs.gov/pub/irs-pdf/f1040es.pdf

It can be confusing navigating the 1099-MISC world where you're an independent contractor or freelancer instead of an employee. You may have to set up a business of some sort (sole proprietor works fine), and you have to keep an eye on any required state taxes too. For example, in Washington State, regular employees don't pay state income tax, but freelancers who own their own businesses do. Go figure.

I'd personally put all the money you can into tax-advantaged retirement accounts, as long as you're pretty sure you won't need to touch it before you're 59.5. Even if you do, there are ways; other threads in this forum address them.

It depends on how much OP wants to put in each year - if 20% of (net income less 1/2 self employment tax) is enough room for what OP wants to do, SEP-IRA is indeed the simplest.  If more than that, then SoloK is the way to go.  Or there is an income / contribution range where SIMPLE can make sense, but since a one-participant SIMPLE is essentially a SoloK with lower contribution limits, I'd probably go SoloK even in that range - one less thing to worry about when my income or desired contribution level goes up.

[Telecaster]

I'd recommend a SEP-IRA for simplicity. You can put a lot more into that than you can into a tIRA or Roth IRA; it's based on a percentage of income, not a global limit of $5,500. You can Google some calculators for info about how much you can contribute for your income level.

The complexity of the solo 401(k) is over stated.   It is a little more complex than the SEP, but not much and the 401K contribution limits are much higher.

The only niggle I have with the 401(K) at Fidelity is that it is harder to make contributions.  You can't just transfer money online with like the SEP.   You have to call them and transfer it that way.  But that's pretty painless for the advantages you get.

[Roboturner]

I use Vanguard for my i401k, they do direct bank transfers. No online only statements though (crazy!!!) so i get swamped with Vanguard mail every month