Question for Self-Employed: Have you started on Retirement Plan?

Discussion in '401k, IRA and Retirement' started by thestoryteller1, Jul 22, 2014.

  1. gracer

    gracer Senior Investor

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    I'm also self-employed right now and I must say that I haven't been able to set aside anything for my retirement when I became that. It's funny because when I was still employed I was able to set aside a percentage of my salary for savings aside from the deductions put to social security. I guess my change of status from single to married also became a factor. Now that I'm married I don't really have much control over money anymore. I always have to consult everything with my husband first. That's why I decided to find a decent business online so I could somehow make my own money and maybe save a portion for the future.
     
  2. pwarbi

    pwarbi Senior Investor

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    I think people who are employed by a company have trouble finding the money to set aside for their retirement so those that are self employed will no doubt struggle even more.

    While it's important to save for the future, is it worth sacrificing the way you live today just to do that?
     
  3. JR Ewing

    JR Ewing Super Moderator Staff Member

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    I would definitely say that you should put a little something away for the future each month or each paycheck, even if it means cutting a few corners here and there in the present.

    Most people spend too much and live too high on the hog. Most people drive a car that is as expensive as they can afford, for instance. If you had to choose between driving a $60k car that costs you nearly $1k a month, but that would keep you from being able to contribute to your retirement savings, you'd be better off driving a $30k car for less than $500 a month, and putting that $500 you save each month into your 401k - which hopefully will also have some $ match from your company.

    I know people who never made 6 figures who retired with 1, 2, sometimes 3 million because they lived frugally and invested wisely. And others who make lots of money who are literally living from paycheck to paycheck and probably won't ever be able to retire.
     
  4. Corzhens

    Corzhens Senior Investor

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    My husband can be considered self-employed since he works only as consultant and have no retirement plan in their office. His only fallback is the social security pension which is a meager amount of $10 a month so we can discount that. What he does is save an amount for himself in the bank and he is thinking of buying something as an investment like a small lot which he can sell when he finally retires. But for now, he is still okay with his small salary so he is not in panic regarding retirement 401k.
     
  5. kgord

    kgord Senior Investor

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    No, and I don't make enough money to do so. The best I might be able to do is to put money back on the 401K that I put out. It is one of the things that I need to do. Survival first then I will worry about retirement. It is jus tone of the things that I need to think about. It will be coming perhaps sooner than I think. Well anyway, I suppose I will survive, I do now.
     
  6. Corzhens

    Corzhens Senior Investor

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    I fully agree with that - do not sacrifice the present for your future. It is not bad to save for the future but live your life to the fullest. We don't know what the future brings. What if we die tomorrow? That is a saying in our country to give people the realization that the present is more important than the future. And with retirement money or pension or any funds for old age, it is also important but not to the extent of jeopardizing your welfare for the present. Just save some and be content with that.
     
  7. nytegeek

    nytegeek Well-Known Member

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    I am self employed out of pure necessity to cover basic costs. Retirement planning isn't high on the agenda when you need to put food on the table and keep a roof over your head. That said, I do try to save some money out of any income I receive.
     
  8. Corzhens

    Corzhens Senior Investor

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    That is also my point, some would save for their retirement amidst the necessities. It's not wrong to spend because you are earning for your keep and the livelihood is meant for living and not really for saving. Lucky are those born to rich families since they don't have that problem of thinking about retirement. But for us mortals, we need to think of what happens in our old age years. But then again, we should give priority to the present and leave the future just about 10% or maybe 20% of the attention.
     
  9. anders

    anders Well-Known Member

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    When you work self-employed, you quickly realize just how valuable those built-in benefits you get with a salaried job really are! I used to be amazed at the hourly rates that self-employed contractors would charge, but you forget that out of that pay they have to cover sickness insurance, medical insurance, pension payments, any many other sundry charges that they're liable for.

    Being self-employed is great, but it comes with its risks and downsides, that's for sure.
     
  10. Kate

    Kate Senior Investor

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    I would generally agree with this, Corzhens... but I did have a thought when I read this... that being that what some people would consider a sacrifice could get them into a lot of hot water for the future. Mostly I'm thinking of technology... like if someone really can't afford the newest gadgets constantly, or paying service contracts on what they already have, they'd probably consider it a sacrifice they don't want to give up... but that doesn't mean it's a wise decision.

    For some, not having the sleekest car in the parking lot would be a sacrifice... or the nicest house on the street... so sacrifice becomes a matter of personal definition.

    Also I'm thinking that yes, if we die tomorrow, we won't need the money we saved... but if we don't die tomorrow we could have a heck of a mess when we retire if we didn't care enough to prepare.

    Your thoughts on that? (Sometimes I think too much... if that's the case here, just ignore me.) :D
     

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