SEP IRA Setup

Looking for deduction

[Hunter]

Anyone care to share any advice or have an opinion on the best place to open and fund a SEP IRA for a 2004 deduction?

[treeline]

Try either Fidelity (huge, easy, lots of fund options) or Vanguard (famous for very low fee index funds).

I've been quite happy with SEP IRAs as the way to go.

[Chief]

I used Vanguard for my SEP last year. They have many low expense ratio funds. But if you have a LOT to put away as a tax deferred deduction, consider a solo/self employed 401k (granted you would need to be the only employee). Fidelity offers those as well as the SEP.

[Hunter]

Thanks treeline & Chief, much appreciated.
Anyone else care to share their experiences before I take the plunge?

[conroy]

Be careful, a lot of these plans require that they be entirely set up in 2004 in order for you to make a contritbution for 2004.

Solo 401k is a great deal, by far the best if you make less than 200k from your business. On $40k of income you could put up to $23k of it into the account if you are a corporation, and get the deduction for the full amount. I'm not a tax adviser blah blah...

[Webwork]

When fortune favors your income stream pour it into the SEP to the max contribution and don't look back. That way, when times are lean, you've built up your nest egg. Remember: If you have full time employees then you are obliged to contribute after a certain period of time. Review this with your accoutant.

IF you are going the "roll your own portfolio" route then look for a brokerage that has the lowest stock trading fees. Study the details of the fee structure.

Since the stock is in a SEP there are no tax concerns about trading, only concerns about profiting.

I waited until I was past 35 to start saving for retirement, so I decided to take a bit more risk. If you are prepared to play with high risk, high return microcaps then consider doing what I've done: Research the heck out of 1 or 2 companies, take substantial positions in your SEP after performing your research, attend the company's user conferences (if they offer them) as a way to get to know the execs and sales force, get in on the quarterly conference calls and ask questions and play like you own the company 'cause you do. This approach has paid off for me but it's been a lot of work. Tax free income for the work, thankfully. ;0)