Need Money to Start A Side Gig?

Your 401(k) can come to the rescue!

Yep, why not?

In today’s world it is tougher and tougher to find money to start businesses. One way you could do so in 2024 is to use your retirement assets. Yes, you can fund a business with your IRA dough.

While most people are aware of the option of using their 401(k) to purchase a home, most are not aware that the option exists to use their 401(k) to fund a business. Let’s look at how you can do that.

Here is the process to set it up:

1. Set-up a C Corporation. You can do this yourself or hire an attorney. There is no shortage of information available online to guide you. Your C Corporation will need to create — but not issue — stock.
2. Have the corporation adopt a 401(k) retirement plan. This retirement plan should be a profit-sharing plan that permits all of the plan assets to be invested in company stock.
3. Rollover your 401(k) or IRA to the new 401(k) in your C Corporation. Keep in mind that you can have multiple sources and even multiple people involved. That includes your spouse or anyone else that’s interested.
4. Issue stock and transfer it to the profit sharing plan. This is in exchange for the cash that was in the plan.

You can then use this cash to go out and invest the money in your business. The process is simpler than it appears. You can do it with a little help. Some companies will set…