Self-Employed

You work for yourself.

READ2 min · UPDATED2026-04-30

Reviewed against primary sources cited at the bottom of this page.

Self-employment changes taxes, retirement accounts, health insurance, and cash flow management completely. The standard W-2 advice does not apply, and the gap costs more than most people realize.

This page covers personal finance fundamentals that apply regardless of your view on Bitcoin or fiat currency.

This page covers US-specific accounts and tax law. Outside the US? Self-employment requires equivalent attention to local payroll-tax structures, retirement vehicles, and health-care decisions.

THE SHORT VERSION

Being self-employed means you pay both sides of Social Security and Medicare, 15.3% before income tax even starts. There's no 401k match. Health insurance comes out of pocket. Income arrives in lumps. None of this is a reason to avoid self-employment, but it requires a completely different financial system than the W-2 world. This page maps it.

Start here

1 · THE FRAMEWORK

Gig worker and freelancer finance

Quarterly estimated taxes, 1099 reporting, deductible expenses, and the difference between gross billed and what's actually yours.

2 · THE STRUCTURE

LLC vs S-Corp

When the S-Corp election actually saves money. The break-even is around $60K net income; below that the paperwork costs more than the tax saved.

3 · THE BIG ACCOUNT

Solo 401(k)

Up to $72,000 per year in tax-deferred savings. The single biggest tax-shelter advantage of being self-employed.

Your most important tools

Tax Estimator

Model your quarterly estimated tax payment so April isn't a surprise.

Savings Rate to FI

Self-employed FIRE starts with knowing your actual savings rate net of self-employment tax.

Roth Conversion Sweet Spot

In low-income years between gigs: convert to Roth at the lowest rate you'll ever pay.

Common questions

How do I handle quarterly estimated taxes?

Set aside 25-30% of every payment received immediately. Pay quarterly by April 15, June 15, September 15, January 15. Use a separate account so the money doesn't sit in checking. Gig worker finance →

Should I form an LLC or S-Corp?

Under approximately $60,000 net income: LLC as sole proprietor. Above that: S-Corp election can save meaningful self-employment tax. The transition has overhead. LLC vs S-Corp math →

Where do I put retirement savings?

Solo 401(k) first. Up to $72,000 per year in 2026 between employee and employer contributions. Solo 401(k) explainer →

How do I get health insurance?

ACA marketplace. Premiums are 100% deductible above the line for self-employed people. Pair with a high-deductible plan and an HSA for the maximum tax efficiency. Health insurance →

How do I budget on irregular income?

Pay yourself a fixed "salary" from a business account into your personal account. Let the business buffer absorb variability so personal cash flow stays steady. Cash flow system →

Reading path

Gig worker finance
LLC vs S-Corp
Solo 401(k)
Health insurance
HSA
Bitcoin taxes · self-employment + Bitcoin creates specific scenarios
State domicile · high earners saving toward a liquidity event

Last updated 2026-04-30. Not financial advice. Do your own research.

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