As you work double time to build a bright future, are your retirement funds doing the same? If you’re just socking money away in a savings account whenever you can, the answer is likely not. Thankfully, you can turn things around quickly by following these tips to make your retirement funds work as hard as you do.
1. Open a Solo Retirement Account
While operating as an independent worker, you can’t count on an employer-matched 401(k) to help you breeze through retirement. Instead, you need to open a retirement account on your own and double up on saving to hit your goals.
You have many solo retirement account options to choose from, such as:
- Self-employed 401(k)
- Simplified employee pension plan (SEP IRA)
- Simple IRA
Each option works a bit differently, so it’s important to weigh your personal financial factors to choose the best one for your needs.
Whatever you do, don’t wait for the perfect moment to open a retirement account and start saving. Like college savings, you should be saving for retirement long before you plan on actually needing the money. You can always change it up in the future. The most important part is getting an account open and saving as much as possible, so your money can grow through the years.
2. Bring In an Online Financial Advisor
Whether you open a solo 401(k) or SEP IRA, you can benefit from the support of an online financial advisor, like Blooom. With their free insights, you can better allocate your funds while skipping hidden investment fees.
You just need to link your retirement accounts to their platform to use their planning tools and get financial guidance without paying a dime. If you’d like a personal portfolio, access to a personal advisor, and other types of premium support, then you can sign up for one of their paid service plans.
3. Sock Away Retirement Funds Early and Often — and Then, Forget About Them
If you want to hit the ideal retirement savings targets for each decade of life, plan to put money into your selected account early and often. Aim to deposit at least 15% of your pre-tax funds whenever you cash out money from each gig.
If you cannot swing that much at first, that’s okay. Just do as much as you can while still putting away money for your estimated tax payments. As you make more money over the years, you can steadily increase the amount you save from every check.
In addition to putting money into your retirement account each time you get paid, be sure to deposit your bonuses and tips whenever you can. The extra boost to your balance will help your money grow even faster, setting you up for a truly relaxing retirement.
As you add to your retirement account, simply forget it exists. You must let the money simmer in the account to steadily grow to a decent nest egg by the time you reach retirement age. Otherwise, you could miss out on big gains and end up far behind in hitting your retirement savings targets.
By taking these three steps, you’ll quickly build up a healthy retirement account you can count on in the future. Just keep moving forward in hitting your savings goals, and you’ll end up where you want to be sooner than you ever believed possible.
About the Author: Marie Abendroth is a skilled content strategist and SEO copywriter who has been a proud part of the gig economy for over 10 years. In her articles, she aims to provide up-to-date info that can help everyone achieve their goals as an independent worker. You can find her on WriterAccess.