How do I save for retirement without help from my employer?

Question

I work for a small company with no pension plan or employer matched contributions. I make the max contribution to my IRA each year. What other options are available that have perks like tax savings or others that can help me save for retirment?

Answer 1

Buy savings bonds. Guranteed 100% return on your investment.

Answer 2

Roth IRA's allow a contribution of up to $4,000 a year if you are below the income limits. You don't get to deduct the contribution, but the earnings grow tax-free as long as you don't take money out too early.

Skip the insurance productions (life insurance or annuities). You can do better tax-wise with a low-churn diversified exchange-traded fund. The insurance products charge high fees and the income is taxed at ordinary income rates. The only benefit is the earnings grow tax-deferred. But holding onto an investment also allows you to defer taxes (except on any dividends or capital gains) until you sell it. Then you pay the lower long-term capital gain rate. ETF's can have much lower fees, too.

Answer 3

Well, you could "invest" in Cash Value Life Insurance that'll help some but won't provide much in the way of return on investment. Let's see how about this. Do something anything outside your normal employment to make extra $$$. Create your small business and open a SEP IRA because they have much higher limits on what you can contribute than do traditional IRA's. GOOD LUCK!

Answer 4

Invest in index mutual funds (or any good mutal funds). You will pay taxes on the dividends the funds pay, but your capital gains aren't taxed until you sell the shares.

I know that's not as appealing as getting a tax deduction now or being able to withdraw the funds tax free down the road, but over time this should provide a good supplement to your IRA.

Answer 5

Open a Roth IRA account. You are not taxed for up to $4000.00
you put in yearly. Go to www.firstrade.com to open a Roth IRA mutual fund account. They do not charge transaction fees for mutual funds. They charge $5.99 though for each stock trade.

Answer 6

You're limited on your tax savings, but many mutual funds companies, such as Fidelity, have programs where you can invest a minimal amount each month on an ongoing basis. I would recommend contacting one of them...

Answer 7

you put money into a ROTH IRA that has already been taxed. You don't get taxed on the gains or income. you don't get a tax deduction on the money you put in...

if you are young it is a better deal, but no tax deduction.