As someone who’s freelanced for nearly two decades, I can tell you that it’s a challenge to save for retirement. It’s a lot easier when an employer is pulling money out of your paycheck.
But when you’re the employer, you need to be much more disciplined. You need to find vehicles that will work for you.
There are some 54 million Americans who call themselves freelancers. That’s about one out of every three workers. Since nobody is putting aside money for us, we need to be better informed about retirement savings options.
According to Dmitry Fomichenko, President and Founder of Sense Financial (writing in 401khelpcenter.com), “freelancers are hardly better than their counterpart salaried professionals in planning for their retirement.
According to a national scientific poll conducted by Greenberg Quinlan Rosner Research in 2016, at least 40% of the participating freelancers didn’t have a formal retirement plan. At the same time, 52% of the respondents were concerned about the unavailability of employer-sponsored retirement plan when choosing to freelance over traditional employment.”
Over the years, I’ve used a few retirement vehicles to save money. For the most part, when I’ve had the money to put aside, they work pretty well. Yet saving is tough. As a self-employed person, my income is up and down.
Fortunately, there are ways to save. The good part is that every mutual fund and financial service company offers vehicles that you can easily set up yourself. Here are the most popular vehicles, according to Fomichenko:
— Solo 401(k)s. As noted earlier, when you’re the employer, you can set up your own plan, but you need a financial company that offers the…