In this episode, Charlie Mattingly, CFP®, MBA and Zack Payne, CFP® break down how professional pilots with side businesses may successfully take their secondary income and defer some taxes legally and strategically.
While many pilots believe they are “topped out” once they max their airline 401(k), a Solo 401(k) (or “Solo K”) may allow you to shield significantly more income from the side gig. Using a case study for a pilot family over age 50, they demonstrate how involving a spouse in the business may increase a family’s annual retirement savings limit from $80,000 to potentially up to $137,500.
The goal is simple: help you understand the nuances of being both an employee (as a pilot) and an employer (the side gig), and how these roles can be used with a Solo K strategy.
Key Topics Covered
- Solo 401(k) Overview: A retirement plan designed specifically for self-employed individuals and side gig businesses.
- The “Double Employer” Advantage: How unrelated employers (like an airline and your private business) may allow for employer contributions separate from each other.
- Spousal Strategies: How employing a spouse in your side gig may open up additional retirement savings opportunities.
Actionable Takeaways:
- Evaluate your side income: If you or your spouse have a side gig, determine if a Solo K may be a viable tool for retirement savings.
- Coordinate your limits: Remember that while employer limits may be separate, your individual employee deferral limit (402(g)) counts as one limit per individual across all plans.
- Consult with professionals: Because of the nuanced tax rules regarding business structure and compensation, seek help from a tax professional or the Leading Edge team.
- Check the math: Ensure your side gig compensation is within the 25% employer contribution limit required by the Solo K.
The world of side gig taxation may feel complex, but the right strategy may help you prepare for a more secure retirement.
Timestamps
00:00 Introduction
00:48 Summary of what we’re talking about
01:13 Real client side gig examples
02:07 Why we’re doing this video
02:30 Overview of the Solo 401 (k) (aka Solo-k) strategy
03:35 Examples of spouse side gigs
03:57 Caveot—when you can’t use the Solo 401 (k)
04:20 Solo 401 (k) example
10:06 Summary of main reasons clients use a Solo 401 (k)
11:06 Overview of how strategy works with employee vs. employer contributions
12:39 How your personalized strategy may be different
12:59 Wrap up and disclaimers
For personalized guidance, visit Leading Edge Financial Planning or reach out to our team anytime.
Connect with Charlie Mattingly
charlie@leadingedgeplanning.com 
865-240-2292
#LeadingEdgePlanning #PilotMoneyGuys #Solo401k #SideGig #AirlinePilots #PilotFinance #SoloK #TaxStrategy #EntrepreneurPilot #PilotLife #PilotWealth #PilotFamily
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this video will be profitable, equal any corresponding indicated historical performance level(s), or be suitable for your portfolio. Moreover, you should not assume that any information or any corresponding discussions serves as the receipt of, or as a substitute for, personalized investment advice from Leading Edge Financial Planning personnel. The opinions expressed are those of Leading Edge Financial Planning and are subject to change at any time due to the changes in market or economic conditions.
