Setting up a Solo 401(k) is a straightforward process. Most clients have their plan documents in hand within 2 to 3 days of completing their application, and are ready to invest as soon as their plan is funded, typically within 2 to 4 weeks. Here is how the process works, phase by phase.
Phase 1: Application
The process starts with a 10-minute online application. You will need a government-issued photo ID and basic facts about your business that is sponsoring the Solo 401(k). If your address does not match your ID, have a recent utility bill or bank statement available as proof of address.
Once your application is submitted, our team reviews it and moves immediately into plan production.
You handle: Completing the online application; providing ID and business information. We handle: Application review and production initiation.
Phase 2: Plan production
This is where we put your plan in place. The phase moves in two steps, each with a brief client touchpoint.
First, we send you IRS Form SS-4 for your signature, authorizing us to obtain the plan's EIN on your behalf. The plan EIN is a Retirement Trust EIN, separate from your business EIN. Once you return the signed SS-4, we obtain the EIN and draft your plan documents.
Once documents are ready, we send your core legal documents for electronic signature. After you sign, we produce the final plan deliverables, including your Trust Agreement, Adoption Agreement, and supporting plan forms, and make them available for download from our secure client portal.
You handle: Signing IRS Form SS-4; reviewing and e-signing core legal documents; downloading final plan deliverables from the portal. We handle: Obtaining the plan EIN; drafting all plan documents; preparing and delivering final plan package.
Typical timeframe: 2 to 3 business days from application approval to final document delivery.
Phase 3: Bank account setup
Once your plan documents and EIN are in hand, you open a business checking account in the name of the plan trust. We recommend a few banks with experience handling self-directed retirement plans, which makes the process a lot simpler.
To open the account, the bank will ask for your Trust Agreement and the plan EIN. You present yourself as the Trustee and authorized signer. The account name should match your plan trust name exactly.
This is your Checkbook Control account. Once it is funded, you direct investments from it as Trustee without any custodian involvement.
You handle: Selecting a bank, opening the account, presenting plan documents. We handle: Providing the Trust Agreement and EIN documentation you need to present.
Phase 4: Fund the plan
Funds move from your existing retirement account or contribution source directly into your plan's bank account. You receive the funds as Trustee.
Important: funds must be deposited into the plan bank account. Do not deposit rollover or contribution proceeds into a personal account.
Typical funding timelines by source:
- New plan contribution: a few days to a week, depending on how you deposit and your bank's clearing time.
- IRA-to-plan rollover: Typically 2 to 3 weeks, depending on how quickly the sending custodian processes the request.
- Employer plan rollover (401(k), 403(b), profit-sharing): Generally 2 to 4 weeks.
- Government plan rollover (457, TSP): Generally 4 to 6 weeks.
We provide clear instructions guiding you on the rollover process, and your plan documents include a Letter of Acceptance for those custodians that may require one.
You handle: Initiating the rollover or transfer with your current custodian or plan; making contribution deposits directly to the plan bank account.
Phase 5: Your first investment
With funds in your plan checking account, you are in Checkbook Control. You sign agreements, write checks, and wire funds directly as the plan Trustee.
Phase summary
| Phase | Who Initiates | Typical Timeframe |
|---|---|---|
| Application | You | Day 1 |
| Plan production and EIN | We handle; you sign SS-4 and legal documents | 2 to 3 business days |
| Bank account setup | You | 1 to 3 business days after documents are ready |
| Plan funding | You initiate; funds go directly to plan | 1 to 6 weeks depending on source |
| First investment | You, as Trustee | Immediately after plan is funded |
Plan ready to invest: As fast as a few days with a contribution; 2 to 4 weeks in most rollover cases.
A note on your data
The information you provide during application is used solely to set up your plan. Once setup is complete, we delete non-essential application data, including copies of your photo ID, from our systems. Your ongoing account information is retained as required to service your plan.
Disclosure
This information is provided for educational purposes only and should not be interpreted as tax, legal, or investment advice. Readers are encouraged to consult a qualified professional who can offer guidance based on their personal situation.