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The individual 401(k) - also known as the solo 401(k) - works much the same as traditional 401(k) plans offered by large companies, but is strictly for sole proprietors who have no employees (although your spouse may contribute if he or she earns income from your business). Like a traditional 401(k), you need to keep the money invested until you reach age 59 ½, with a few limited exceptions. The solo 401(k) allows you to sock away far more than other tax-sheltered plans. As an employee, you can stash away as much as $17,500. As the boss, you can contribute an additional 25% of compensation, up to a maximum of $52,000, including your employee contribution.

Individual 401(k) contributions are discretionary, so you can save the maximum in flush years and nothing in tougher times. If you and your spouse are both in the plan and enjoy a banner year, you could save a total of $104,000. And if you are both 50 or older and eligible for catch-up contributions of $5,500 each, the total climbs to $120,000.

The individual 401(k) also comes in both a traditional and Roth version. With the traditional individual 401(k), you put away money on a pretax basis and it grows tax-deferred. Your money is taxed when you withdraw it, in a future that may well include higher tax rates.

If you opt for the Roth version, you put in after-tax dollars and your money grows tax-free - which means it is not taxed upon withdrawal. You can split your contributions between the two types of accounts. One other point: Unlike SEP IRAs, solo 401(k)s allow you to borrow against your savings.