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Tag Archives: solo 401k

Ways to Save for Retirement When You Don’t Have an Employer Plan

choices for retirement plans

Last week we talked about having a retirement savings wake up call, which is a very important first step in preparing for the future. It’s pretty easy to save for retirement when you have access to an employer sponsored plan, but what about those who are self employed or work for a company that doesn’t offer retirement? Luckily, there are several smart and simple choices for setting up a retirement plan on your own. Can’t I Just Save Money Without a Plan? Of course, if you’re willing to save lots and lots of money. The beauty of having a tax deferred or tax advantaged retirement plan is the ability to save on taxes, now or in the future, plus growing money through the wonderful benefit of compound interest. Without those two things, you’ll need to save much more money to have enough for retirement after paying Uncle Sam up front and from later earnings. To see how much you’ll need to save, try out the free retirement calculator from Personal Capital. Traditional IRA Anyone can open a traditional IRA. If you or your spouse aren’t covered by a retirement plan at work, your entire contribution is tax deductible. If an ...

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Wise Ways To Invest Money

different ways to invest money

When I started this blog, the goal was paying off credit card and consumer debt. Now my focus has shifted. One of the many great things about paying off debt is that once it’s gone, you have extra money every month!  Smart people don’t increase their  lifestyle or go on  shopping sprees. They invest that money for the future. Unless you are buying from a guy named Bernie who guarantees double digit returns with no risk, there really is no right or wrong way to invest. Just about anything you choose is better than nothing, but that doesn’t mean you shouldn’t try to choose the best investments for your future. This list is in no way all inclusive, but these are some wise ways to invest money. Investing For Retirement With a 401(k) If you have an employer plan, usually a 401(k) or 403(b), that’s usually the easiest and best way to invest for retirement. It’s easy because all you have to do is fill out the paperwork and best because money invested is tax deferred. That means you don’t have to pay income taxes now and your money can grow for years. When you do take disbursements from your ...

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How Should People In Their 40’s Invest?

how should 40 year old's invest

If all goes according to plan, as of this afternoon, we will be the proud owners of a new rental property. It’s been a crazy half decade here in the Eyes on the Dollar household. We’ve gone from huge amounts of consumer debt,  to selling a business, to becoming landlords. In all honestly, if 2015 could be the same as 2014, I’d be happy with that, but I never assume things will go the same. It seems the only constant you can count on is change! As 2014 comes to a close, I thought I’d look at the next  year and the next few years and seek out some opinions on where we should go from here. When in doubt, ask someone else! How Should People In Their 40’s Invest? If we were 23 years old,  just starting out with few assets, it would be a no brainer to say max out the 401k, invest in a Roth, or save up for a down payment on a house. As you get older, there are many more  variables. Here is a breakdown of what we’re doing now. Remember we’re old! We are both in our 40’s and hope to retire in ...

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October Goals Update

Fall color in Telluride Colorado

There have been a few goal posts lately as we’ve entered the last quarter of 2014. It’s always fun to see how others have done toward their goals. As I’m about to put my 40th year on this earth to bed, it’s time to see how I’m doing with my goals. 2014 Goals 1) Set up a solo 401k and contribute 25% of my income.  Pass One of the great benefits of being self employed is that you can open a solo 401k and contribute more than you’d be able to with a traditional employer sponsored plan.  Since one of the worst things about self employment is taxes, it’s nice to be able to offset as much income as possible into a tax deferred account. With a solo 401k, you can contribute the standard $17,500 PLUS 25% of your income up to $52,000 for people under age 50. I wasn’t able to do that much, but should be right on track for investing 25% of my income into my solo plan this year. 2) Max out our family HSA. Pass This year we decided to invest our HSA into Vanguard funds. We don’t plan on touching this money until retirement ...

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Ideas About Self Employment

self employment ideas

Self employment is a dream for me because I can choose when and how much I want to work. It also has it’s downsides as well. Here are my ideas on self employment. Retirement Contributions Con-Even though I have been essentially self employed for years, I had someone who kept up with deposits, bills, payroll deductions and taxes,  book work and issued a paycheck to me twice a month. I could set up how much to contribute to retirement and not really have to think about it other than to rebalance from time to time. Now, I have a solo 401k, and I am solely responsible for funding it. Yes, I can set up recurring contributions, but the money still goes into my account before I can send it on. It is sometimes really hard to pull the trigger and let that money go. It’s much easier when it comes out of your paycheck and you never see it. I also don’t get any company match. Pro– The overwhelmingly positive thing about having a solo 401k is that I can not only contribute the full $17,500 employee contribution, I can also put in 25% of the net profits from my ...

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