What type of retirement plan may self-employed individuals use to save for retirement?

Self-employed individuals often use a Keogh plan, also known as HR10 plan, as a type of retirement plan specifically designed for them. These plans allow self-employed persons to contribute a significant amount towards their retirement savings and are flexible in terms of contribution amounts compared to other retirement options. A key feature of Keogh plans is that they can be structured as either a defined benefit plan or a defined contribution plan, providing self-employed individuals with versatile options based on their income levels and retirement goals.

In contrast, while 401(k) plans are primarily associated with businesses that have employees, self-employed individuals may establish solo 401(k) plans. However, the specific term "Keogh plan" is more tailored for the self-employed context, making it more relevant to the question at hand. IRA plans, while applicable, have lower contribution limits compared to Keogh plans, which may not satisfy the retirement savings needs of a self-employed individual. Pension plans, on the other hand, are typically offered by employers for their employees and are less common in self-employment scenarios. Thus, Keogh plans remain the most suitable choice for self-employed retirement savings.