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I didn’t start saving for retirement as young as I would have liked. In fact, my retirement savings was a fluke. I was hired to work at a university but was hired in such a way that I was considered a state employee. Even though you’ve heard me say many times that I was ready to leave my job and that I was really struggling towards the end of my previous career, one of the things that I’m most grateful for from my old job is my retirement plan.
I have a fully vested retirement plan and it is basically considered a pension plan. That’s right-I have a state pension. One of the major concerns that I had going into self-employment was the very real possibility of slipping up with my retirement funding. When I worked at the university my retirement funding was taken out of my hands. I had no choice but to save for the future.
Every month eight percent of my income plus my match was invested into my account. That monthly amount was a pretty nice and grew steadily over time. My concern going into self-employment was that I knew my personal money habits and was aware that I am not a natural saver. In fact, I can safely say that it has taken the past three years to really kick my spending habits to the point where I could save without feeling like I was suffering or missing out on something with that money. In order to kill my spending habits I had to literally stay out of the stores. I haven’t gone to Target in almost two years because I cannot walk out with just toilet paper-I would walk out with: toilet paper, a new shirt, wine, and some home decor. Now that I’ve killed my Spending Habit I’ve shifted my focus to extreme savings.
Saving Is Not My Strength
I had to figure out a system that circumvented my tendency to forget to save and fortunately we live in a time where there are a ton of savings tools, companies, etc. that can help get you on the road to saving. The one thing I will say is that I now have a variable income as freelancer and that could be considered a stumbling block towards setting up a savings account. Let’s be honest, saving for retirement and as an entrepreneur is a much more deliberate process. I have to be very proactive about my retirement process-much more than before.
I became a freelancer because of my experience blogging, if you’re interested in starting a blog click on the following link.
As my income stabilizes over time I will adjust my savings and increase the monthly amount I set aside for savings. I should also add that I just recently started this account because I had decided to wait until I had an ok handle on working for myself before starting my new retirement savings. And, no, I’m currently not saving as much as I was previously was but I will be as soon as I possibly can! So, who did I decide to set up my retirement account with?
Betterment.com
I had heard about the site before and had read some pretty positive reviews. I was able to open a Roth IRA and a Wealth Building accounting basically I am invested in two fairly aggressive savings tools that I contributed to on a monthly basis. Betterment will look at the performance of each portfolio and the reallocate the funds about every 3 months. The idea (I think) is to make sure that the portfolios are always balanced and performing pretty well. There are fees, but they are currently under one percent. If you are looking for a retirement savings plan check out Betterment and Open a Betterment account now (affiliate link) Receive 30 days free (no management fees) with my link and start your savings today!
It has been very important to me to work on my finances and get them to a point where I consider them to be in a much healthier state. Saving for my future-even a little bit at a time, has made me feel like I’m getting things moving in the right direction financially as a self-employed person. I am now extremely motivated to earn more and save more and opening this account is a great first step.
Are you self-employed?
Have You Set Up Your Retirement Savings Yet?
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REtirement, what is it? my company doesn’t offer it because being a realtor I’m considered a freelance this means that I must to save to have funds for retirement…thanks italian burocracy!!!
That is so frustrating!! But, that’s basically how it is in the U.S. We have a much more complicated road to retirement and it’s difficult for a lot of people once they hit retirement because they didn’t plan as well as they needed to. The problem is that people need more information and guidance on the process.
I so bad about saving too! To keep on target, I made my contributions automatically. It’s awesome know I’m setting something aside. Now I just have to keep bump up that contributions 🙂
I don’t like that I’m about 9 months off in savings…but I think with all of the other things that I’m doing to lower overall expenses things will begin to balance out as I make more money.
I’m not self-employed. But I’ve never had access to a 401(k). Pretty crazy, right? So, I’ve been maxing out my Roth IRA for the past few years. And I also save in a brokerage account. I’m not expecting many companies to help employees with retirement in the future.
That’s weird and interesting all in one! I now have a brokerage account and a Roth IRA. I really should have had both when I was working before but I was so bad with my money I don’t think I would have contributed to it. Now, I’m in a different frame of mind and I’m not interested in giving my money to other people before I pay myself!
TBH I’m a little worried about my retirement savings too. I have saved from day 1 at my first job that offered a plan but now that I don’t have an “employer plan” or an “employer match” I haven’t been saving since I quit at the end of the July. 🙁 I need to pick that up, but right now my credit cards have been my main focus.
I just decided that I had to save something…even if it’s a little something… every month. There is power in small amounts of savings over a long period of time.
I have a retirement account but I’ve barely contributed the last few years. I actually want to move away from my financial advisor and some of the fees that I’m paying and learn how to manage it more myself. It will be a huge step for me though.
I’ve decided to go on my own LOL. Go big or go home! Fortunately the fees for Betterment are very low so I will use that as my learning experience. It’s a little daunting but I am looking forward to becoming self-sufficient on every level.
We’re very behind in our savings. I’m a contract worker, since the company that hired me is in a different state. So no matches for me. I want to set up a SEP and try to max it out starting in 2016. We’ll have to see how things go, though.
Well, I feel like you two have been doing a great job of saving for medical and that once that’s taken care of you’ll be able to shift that saved money into your SEP. You’re in the same boat as a lot of people where they are employed in such a way that they have to facilitate everything which can be super stressful. I know that you’ll catch up and make things happen.
Man! Saving is a struggle for me too! I have to remind myself that the money is still working for me. Just in a different manner. I’m also still trying to figure out how to budget for retirement. I paused my contributions until I got sound footing as an entrepreneur.
And YES stay out of the stores! I tell me clients that all the time. Sometimes you have to save you from yourself.
I’ve spent a lot of time thinking about money (beyond what I normally do) since FinCon. I seem to have had a huge mental shift and am ready to put in the work needed to make certain things happen…that I’ve been dragging my feet on. Saving has been a big pain point for me because I felt like I “wasn’t” a saver. Well, that stops now. I like to eat, I like to travel and I enjoy cool experiences. In order to do that those things I need money. Also, I never want to work in an office again-so I got pretty freaking motivated to save my money LOL.