Question : What is the best retirement plan for self employed worker?
I am 32 and working as a real estate agent. I don't have a retirement plan yet, people tell me to open a RothIRA or a simple 401k...i don't know much about these things, any advice is appreciated.
- asked by Bank
All Answers:
Answer #1
About.com has some good info on your options. Assuming you qualify, your first step should be tocontribute to a ROTH IRA for 2007(you can do thisbefore April 15th, 2008).
- answered by VaTreasures
Answer #2
Roth IRA, put as much as you can afford to init.You can also do more liquid, safer investments,like CD's and money markets.
- answered by Chuck
Answer #3
For your situation ... Go for the Roth until youhit the limit, then put it into a 401k# If yourworkplace offers a 401(k) with company match,start there, but don't count the match as part ofyour 15%. If something happens (you change jobs,the company quits matching, etc.), you know you'restill putting in what you should. If 4% ismatched, put in 4%. Any time your employer givesyou free money, take it.# If your company doesn'toffer a match or a retirement plan at all, startinvesting in a Roth IRA. If you are married andboth spouses are working, you both should takeadvantage of this powerful wealth-building tool.The best part of the Roth IRA is the interest anddistributions on it are tax-free. If you put in$3,000 a year for 30 years in a growth stockmutual funded Roth IRA averaging 12% (the 70-yearstock market average), at the end of the 30 yearsyou will have invested $90,000 but it will havegrown to $873,000 with no taxes to pay!# Currentlythe contribution limit is $4,000. In 2008, youwill be able to put up to $5,000 in a Roth IRA. Ifyou are 50 years of age, you can put in an extra$1,000 on top of the limit to "catch up." Takeadvantage of this if it's applicable to yoursituation.More info in the link below on thedifferences.
- answered by Jaclyn&Dave
Answer #4
Let me start by saying, what you need to startfirst is a 'Traditional IRA. What is that? You take the money to a Savings institution, and Openan IRA acct.. You can put up to $2000 dollars, init each year. Preferably all at once on Jan 1 You shop all the banks for the best interest rate, andit is locked up in a time certificate for 18mon or3yrs..And you do an annual contribution everyyear thereafter.. Now the good part,, you writeoff the $2000 off you income tax, which will netyou a refund from five to six hundred dollars,every year..Depending what your tax bracketis..The$2000 keeps earning interest and you got600 of it back..It grows tax free till you takeit, in retirement.. Then you can take the $600refund and invest in stocks ,bonds ,whatever elseyou wish to try for additional retirementinvestments. A 401k is really only good if youhave an employer who matches a percent of your contributions.. Your self-employed so its allyour money.. You can also have a roth I RA which is an investment vehicle which uses themarkets ,mutual funds and bond funds for growth. Do yourself a favor and stop in one day at yourfavorite bank , and sit down with a financialadvisor and planner, ask them about retirementvehicles, but just listen.. Then check at several more.. After about three, you'll have allyou need to know to make a intelligent deceision..Being a real estate agent, you know mortgage loanvehicles are different, and so is retirementinvestments.. Hope this helps,, I myself practicedthis very method ,and retired financially secure.. GOOD INVESTING!! SOLOMON
- answered by solomon
Answer #5
2 common self employed retirement plans are theSEP IRA and Individual 401k. I'm self employedand setup an Individual 401k. There were 2websites that helped me understand these 2retirement options.1)
http://www.sepira.comThislink compares both
http://www.sepira.com/sep_ira/sep-or-401k.htm2)
http://www.individual401k.com
- answered by Jason F
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measure and fulfill your financial needs
