In a world where most days are spent working, saving for retirement is one of the biggest financial goals for everyone. Everyone looks forward to a comfortable future when they grow too old to work, but this is impossible without retirement savings. Unfortunately for some people, popular retirement plans such as 401(K) and Roth IRA are not always available.
However, there are many other alternative ways to ensure that your elderly days are catered for. Here are different ways for saving for retirement.
You will be subject to taxation if you decide to save through a brokerage account, but there will also be many more benefits compared to a 401(K) plan. A brokerage account will serve you two purposes: investment and saving. There are many investment options to choose from including bonds, stocks, exchange-traded funds, mutual trust funds, and money market funds if you are looking for high risk/high reward.
Considering that many people are always looking for ways to save more for retirement, a brokerage account is an excellent alternative as your investments will generate profits. What’s more, the long-term capital gains tax is lower than that of most other investment options. However, you need to be smart with your investments to avoid losses; work only with leading brokerage companies.
Real Estate Investment
Real estate investments are a suitable alternative to common plans such as IRA. For starters, interests grow at an exponential rate considering the fast pace at which the industry is growing. Additionally, it is much more flexible than other common options.
Real estate investments offer many alternatives for your retirement savings. For instance, you can relegate everything to a Real Estate Investment Trust that will invest your money and send you the proceeds every month. Alternatively, you can cut off the middleman and buy real estate property yourself; the income stream can go to your retirement savings.
You can also kill two birds with one stone through real estate investment. You will need a cozy place to live in without having to answer to the landlord every month. Why not buy residential property, lease out the apartments, and renovate one of the apartments to suit your preferences?
Save for Retirement
This is the simplest alternative of saving into retirement vehicles, but it is not exactly easy. It takes self-discipline, consistency, and dedication. If you can do it, then there will be many conveniences to enjoy; you will technically be rich.
Some people prefer to save into their accounts rather than incur the charges associated with investment vehicles. They adopt a financially organized lifestyle that prioritizes on savings and investments. For instance, they show more prudence in their spending habits such as avoiding debts, shopping for best deals, and creating budgets. They are also very punctual and diligent in setting aside their savings with every paycheck. What’s more, they often make investments to increase their savings.
If you can resist the temptation of impulse spending as your savings grow, then you will retire rich and learn the skills needed to be a good money manager and business person.
Start a small company
A small business is a sure way of a steady income stream from the get-go well into your retirement age with the right management. Additionally, it does not have to engage your time as you can be an invincible partner or owner as many other people are doing.
There is almost no limit to how big a small company can grow and, consequently, how large your retirement fund could be. However, you need a good manager to pull it off, or your direct insights and good business skills if you do not mind a hands-on approach during your old age. There is also the option of investing into a small but promising company in the capacity of an invincible partner; however, you would have to forego some benefits owing to your inactivity in running and growing the company.