Retirement Planning Tips for Freelance Writers

Retirement Planning Tips for Freelance Writers

The life of a freelancer can be pretty difficult. Income levels are often irregular, making it difficult to budget for savings and retirement. Sometimes you barely have enough for the essentials while other months you work hard to catch up on the past-due bills from the month before. Still, its important to keep retirement planning somewhere in your mind at all times.

Open a Self-Employed Retirement Plan

Start by opening a self-employed retirement plan. You’ve probably heard of the typical retirement plans, like the 401(k) and or the SEP IRA. Self-employed retirement plans are similar in nature but are designed specifically for individuals who are self-employed, whether they’re partners or sole proprietors. The differences lie in how much you can contribute annually while the withdraw rules are generally the same as with any other retirement plan. Make contributions as often as possible.

Create Residual Income Sources

You’re a writer. So write. Seriously. If you usually write content for others, start to focus on writing some ebooks and products you can sell. Self-publishing is all the rage and you can sell on Amazon or through your own website. You can use these products to save for retirement or as a source of passive income you can use once you decide to retire (or both).

Investment Portfolios

If you do have a little bit of money to spare, consider opening an investment portfolio with a money mutual account. You may even want to consider trading penny stocks or some other sort of stock or bond. This isn’t ideal for many, but if you have a keen eye for business, this may work for you. Use a stock market simulator to practice trading and make sure you learn as much as you can about the market before investing your real money.

Live Frugally

Live a frugal life now and you’ll have more money to live comfortably during your retirement years. The truth is that you have to save money or you won’t be able to retire. It doesn’t matter if you open a 401(k) or open a savings account. Your money needs to go somewhere. That means living frugally and saving at the end of each week or month. Buy generic food at the grocery store, stop buying electronics you don’t need. Use libraries or an eReader instead of spending $100 each month in the bookstore. Cut down on your drinking and partying. Make coffee at home instead of buying 2 cups of Starbucks daily. You get my drift.

I’m constantly thinking about retirement. This coming year I’ll be opening a 401(k) plan for self employed individuals and I’ll be making conscious goals for my future. What are yours?

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