It’s not too late retirement plan
You may have woken in a cold panic wondering who’s gonna wipe your butt in your old age because you haven’t saved a dime for retirement, but it’s not too late to start a late retirement plan. It is, however, too late to wait any longer.
What you’ll find as part of the 9-step plan:
- When should I start?
- How to know where I stand?
- What about retirement plan contributions?
- How can I be smart not greedy about investments?
- Should I keep working or become an entrepreneur?
- What insurance do I need?
- Should we get married?
- Is real estate the right investment?
- What about debt?
The 9-step late retirement plan
1. Start now
The first step of nine in the late retirement plan is the most obvious: start now! Don’t dilly dally or dawdle. Retirement is no longer so far in the future for you to picture it.
Like virtual reality, it’s here. It’s now.
Your job now is to face reality. Your responsibility is to take responsibility.
2. Know where you are now
You can’t figure out how to get to where you want to go if you don’t know where you are. So, get to wurq.
Gather all your statements to all your accounts or, if you’re a modern mo, get online access to all your accounts. Search far and wide to calculate every cent you have and every cent you owe. This includes getting access to that 401(k) you signed up for at that job you had for two months. This means figuring out what happened to that credit card account you abandoned years ago thinking you’d never have to pay it off.
Do you have pension plans anywhere (are there pension plans anywhere?)? Do you own a small IRA at a local bank somewhere? Do you have a 403(b) at a non-profit you worked at during college? Have you already inherited any money that’s in a bank account you never accessed?
Search far and wide. Go high and deep. Get everything.
3. Maximize retirement plan contributions
Because your future is not so far off, sacrifice today for tomorrow. For your long-term benefit, cut back on your today and put all your extra money in your retirement accounts. Maximize contributions to your employer-sponsored retirement plan.
If you don’t have an employer-sponsored retirement plan or are fortunate enough to have money left over after maxing out contributions to your employer-sponsored retirement plan, contribute to a Traditional or a Roth IRA.
Hear about the differences between Traditional and Roth IRAs on this Queer Money®:
If you’re over 50 years old and have access to an employer-sponsored retirement plan (401(k), 403(b), 457), the IRS will let you make “catch-up” contributions. In addition to the $18,500 regular 2018 contribution limits for 401(k)s, you can make an additional contribution of $6,000. Catch-up contributions for Traditional and Roth IRAs let you invest $1,000 in addition to the regular contribution limits of $5,500.
According to Fidelity, this could mean an additional $1,000 a month after taxes in retirement spending. That’s nice, huh?
If you have any money available after maxing out an employer-sponsored retirement plan – why have you not been investing all along – invest even more money in a brokerage account.
If you’re a low- to middle-income earner, use the Saver’s Credit. Instead of taking a tax deduction on your individual IRA or company-sponsored retirement account contributions, file for the Saver’s Credit. The Saver’s Credit may take up to $2,000 off your tax bill.
Tax credits are better than deductions because they’re a dollar-for-dollar reduction in your taxes. Invest 100% of all your tax refund and tax savings in an IRA or brokerage account and make it work for you. Talk with your accountant to see if the Saver’s Credit is right for you.
4. Be a smart investor, not a greedy one
Most of those who avoid investing do so because they think investing’s hard. It’s not. Click here to get our 10 super simple steps investing.
Watch below for more super-simple investing tips:
Don’t invest too conservatively. Avoid keeping your money in cash or in interest-bearing accounts. These investments won’t keep up with inflation, which buys you less with each dollar.
Always be an investor. The trend is to migrate to more conservative investments, like bonds and CDs, as we age. To keep up with inflation, this isn’t a good strategy. Keeping 20% to 40% of your investment money in large cap, medium cap and small cap stocks makes sense. For definitions of those terms, get our Super-Simple Investing Guide here.
Don’t be too aggressive – think Goldilocks. Avoid hot investing tips and today’s trends. The rare person who gets rich off these investments make the news, but most people get burned. So, don’t gamble but follow a more certain investment strategy.
As we said in our #DFGLive above, you don’t have to do all this on your own. Hire a robot, as we outline below!
Retirement robots for hire
Try Blooom for your 401(k) or 403(b)
Get 401(k) and 403(b) investing help from Blooom. Investment advice for 401(k)s and 403(b)s is limited and it can be hard to pick and manage the investments on your own.
Let Blooom do all the work for you. Get your FREE Blooom analysis by clicking here.
If you have a Traditional or Roth IRA at Vanguard, Fidelity or Charles Schwab, Blooom can help you there, too.
If you’re concerned about the current market volatility and its effects on your 401(k), 403(b), Blooom as three special O’s to help you with your investing during these turbulent times that you can see here.
Hire M1 Finance
If you’re an independent investor, try an account with M1 Finance. M1 Finance is free for retirement accounts with a minimum of $500 that you can access by clicking this link here.
M1 Finance is a flexible investing automated platform and great for individuals who are comfortable managing pre-built and customized Exchange Trade Funds (ETF)-based portfolios (see below), though they can model pre-built portfolios by Wall Street experts and robo-advised (robots!) models.
• Trading is free
• There are no asset under management (AUM) fees
• There are no account fees (for brokerage accounts with a minimum of $100 and retirement accounts with a minimum of $500)
M1 Finance also allows for socially responsible investing, which is huge for the queer community.
Crack your retirement nut with Acorns
Too broke to invest for retirement? Wrong. Investing through Acorns here!
5. Work longer for someone else (if you must) and become your own boss
Your investment strategy should be focused on your cash flow and not savings. The latter works, but the former is better. If you can work longer for your current employer or a new employer you’re more passionate about, do it and go hard on steps three and four.
Go into business for yourself in addition to or instead of working for someone else. Again, the latter works, but the former is better. Today’s gig-economy affords way more options to create side hustles and main hustles. Within three years, we were making $60,000 from our own freelance writing.
See below for more tips on starting your own hustle or side-hustle:
- Start a blog for less than $4 a month. Sign up here for BlueHost to get our negotiated discount.
- Become an Instagram marketing pro to either grow your blog or become an influencer. Sign up for The Mother of Marketing’s Instagram Masterclass by clicking this link.
- Sell affiliate products or your own products, like some of our Credit Card Pay Off Plan students do, on Amazon and Etsy.
- Become a Facebook Ads pro to help other business owners. Learn all there is to know by signing up at this link here.
- You can learn to become a freelance writer from our mentor here and make $60,000 a year in less than two years as we did. Sign up here.
- Make $22+ an hour by clicking here teaching English to people around the world.
- Write and publish your own book with Publish Your Purpose Press, a queer-owned and operated publisher created to help queer authors and readers live bigger. Start your authorship here.
- Become a virtual assistant and earn $10,000 a month. Sign up for $10K VA by clicking this link.
- Becoming a published author with Make Money with eBooks. Learn more by clicking here.
- Become an Airbnb host and have rentals all over the world, using this Airbnb link here to save $55.
6. Get insured
It may cost more than you’d like, and you may not get all the coverage you want, but it’s time to call in the big dawgs. Apply for long-term care insurance (LTCI). If approved, LTCI will get you in-home care if you become disabled and it’ll help pay for a retirement or nursing home facilities if needed.
Most queer people don’t children to take care of us as we age, especially as our bodies and systems deteriorate. Even if we do, we don’t want their last memories of us changing our adult diapers.
Hear Ryan Taylor of LGBT Financial talk about long-term care insurance:
Then, look for the appropriate health insurance for your needs.
1. Try GoHealth for health insurance
Searching for, finding and getting health insurance easier and more affordable thanks to GoHealth.
After answering a few questions, GoHealth will research the landscape of health insurance providers for you and give you a select short-list of the most appropriate providers for you and your family.
2. Check out Haven Life for life insurance
Today’s life insurance is not your father’s life insurance. See what we mean by finding and applying for term life insurance offer though MassMutual at HavenLife.com.
7. Get married
For the love all that is holy and sacred, if you have a partner marry him. For starters, when one of you passes away, the other will inherit all your marital assets and anything not excluded as a marital asset in your marital agreement, should you have one.
Likewise, Social Security Spousal and Survivor benefits only apply to married couples. With the spousal benefit, you or your spouse can receive the higher of 50% of either worker’s benefit (whoever worked or earned the most). With the survivor benefit, the surviving spouse receives the larger of 100% of theirs or their deceased spouse’s Social Security payment. You need to be married for a year to qualify for the spousal benefit and nine months to qualify for the survivor benefit.
These benefits could seriously change the dynamic of your late retirement plan and your retirement.
8. Invest in real estate
Consider a reverse mortgage for your current home
Reverse mortgages today aren’t what they used to be. A reverse mortgage lets you systematically take equity out of your home to support you through retirement. They’re not for everyone, but reverse mortgages for the right person are great.
If you wish to leave your home to heirs, only the amount of equity not paid to you can be inherited. Your whole property cannot be inherited, as a reverse mortgage relinquishes your full ownership of your property.
They’re not the answer to all your late retirement plan concerns, either. You’ll still pay real estate taxes, utilities, and hazard and flood insurance premiums. This is cost-prohibitive for some retirees.
Talk with an unbiased professional and your family before signing up for a reverse mortgage.
Become a real estate investor
Getting a reverse mortgage is an option but a scary option for some. But there are many ways to get into real estate, such as buying properties for renting, flipping, using for Airbnb and more.
We talked with Mindy Jensen, one of Bigger Pockets’ biggest stars, on the Queer Money® podcast. Mindy shares numerous ways to make money with real estate investing.
Listen to Mindy talk real estate investing on Queer Money®:
Below are a couple of platforms that let you invest in real estate without necessarily buying and managing the physical properties yourself.
AcreTrader was created to provide investors direct access to the highly attractive asset class of farmland. This is a niche that many miss out on and can help to diversify your portfolio.
Yes, the M1 Finance from above. M1 Finance is another trading firm that lets you invest in real estate through it’s M1 Finance REIT. This may be another reason to go with M1 Finance by clicking this link.
9. Pay off debt (now!)
Interest payments on debt erodes savings. Pay off as much debt, ideally all debt, before you retire. To pay off debt the fastest way possible, click here to learn about our exclusive Debt Lasso Method.
Get a glimpse of the Debt Lasso Method here on CNBC:
For help following the Debt Lasso Method, paying off your credit card debt fast, saving money and improving your credit score, sign up for the Credit Card Pay Off Plan here today.
Then, avoid debt like the plague.
There’s a current trend of retirees buying newer and bigger homes and taking on newer and larger mortgages. This doesn’t make sense and is risky. Avoid this and similar desires that detract from living your retirement well.
As you can see, all hope isn’t gone, but don’t wait another minute. Make the commitment and do what’s necessary to protect your future.
For more retirement planning greatness, click below:
- How to Retire? 21 Tips for Financial Planning for Retirement
- 22 Way Gay Retirement Communities + Tips for Your Gold Years
- What To Know Before Filing Your Gay Taxes
Note: This article contains affiliate links, meaning we’ll receive payment at no cost to you if you buy through these links. We only recommend products we use or thoroughly vet and would recommend to our moms. Buying too many of these is how you live fabulously broke. To live fabulously with financial security, start here.