Hi, after two tries at retirement I'm back to work

[Poke-N-FL]

I tried retirement at 62, lasted 7 months, then again at 66, lasted 7 weeks. I have have concluded that I love the work I do with the senior living industry. I am a consultant to senior living sponsors of not for profit retirement communities. I contract my services to a firm based in the Carolinas. My wife and I have merged families - 6 children, 8 grandkids - and live in Florida.

As a self employed contractor I am interested in stashing away as much $$ as possible in the next three years (yes, 70 is it for sure!). I am most interested in exploring the how-to's of setting up a 401(k) for myself to shelter income during that time. Any thoughts will be appreciated.

Graduated Oklahoma Military Academy (66) and Oklahoma State University (69) and am a huge Poke Fan - hence the user name. Also former Marine (63-65). Good to be onboard!

 

[martyp]

There is nothing wrong with doing what you want to do even if you get paid for it. The question is: Are you financially independent? Would you do what you are doing if you didn't get paid? It sounds like you would.

Stashing away as many $$ as possible . . . well . . . that may be a different issue.

 

[MasterBlaster]

I take it you are self-employed. If that's the case then you can shelter up to $22k per year from the (employee) side. The employer (you) can then shelter an additional 25% of your income (up to $49k total deferral).

If you have a high income you could theoretically shelter up to $71k per year in a self-employed 401k plan.

there are a number of mutual funds and different websites that can help with setting this up.

here is a link to Fidelity's website on this topic:

https://www.fidelity.com/retirement/small-business/self-employed-401k

 

[Spooky]

Hi,

If you have a lot of income, you could look into a personal defined benefit plan. I am not an expert, but the max is 195k. There are some actuarial calculations that have to be done so there is a significant fee charged by the companies who offer this. I remember Schwab was $750 per year. So only worth it if you have a lot to put away. But it's an interesting option for the right person.

 

[kcowan]

I don't think there is any stigma with failing at retirement. I would just question why you think it will be different at 70?

 

[Letj]

I take it you are self-employed. If that's the case then you can shelter up to $22k per year from the (employee) side. The employer (you) can then shelter an additional 25% of your income (up to $49k total deferral).

If you have a high income you could theoretically shelter up to $71k per year in a self-employed 401k plan.

there are a number of mutual funds and different websites that can help with setting this up.

here is a link to Fidelity's website on this topic:

https://www.fidelity.com/retirement/small-business/self-employed-401k

Do you know if one can be considered self employed if their source of income is rental income that's reported on Schedule E not Schedule C. Therefore, no self employment tax is paid. How about if your spouse is employed full-time?

 

[flyfishnevada]

There is nothing wrong with doing what you want to do even if you get paid for it. The question is: Are you financially independent? Would you do what you are doing if you didn't get paid? It sounds like you would.

Stashing away as many $$ as possible . . . well . . . that may be a different issue.

Ya, if you're FI and doing it because you love it, then what's the problem?

 

[frhoads]

Do you know if one can be considered self employed if their source of income is rental income that's reported on Schedule E not Schedule C. Therefore, no self employment tax is paid. How about if your spouse is employed full-time?

No.