Self-directing a 401k plan... is it possible

[John-David Herlihy]

I have a small company, set up as a C corp, complete with a 401k plan. I would like to self-direct my contributions to the plan. Is this possible? All I can find is information on Solo 401k plans, but I don’t think that will work with how our company and 401k are structured. Currently, it is just my wife and I that are employed, but we are actively working to bring employees onboard.

Looking forward to the comments from the experts on this board.

[Brian Eastman]

@John-David Herlihy

If employees are on the horizon, then your business will not qualify for a Solo 401(k).  Such plans are designed for owner-only businesses with no full time employees.

While it is possible to setup an ERISA 401(k) plan in a company with employees that can be self-directed, it is generally not beneficial to do so.  The administrative requirements of such plans as well as the liability you take on as a plan trustee make alternative assets less than simple, to say the least.