How Freelancers Can Build Retirement Savings

For self-employed freelancers - who don’t have access to an employer-sponsored 401(k) - is a SEP IRA the best option to save for retirement? Nick and Griffin share their savings strategies, and explain why a SEP IRA (Simplified Employee Pension) might not be necessary for many freelancers.
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Watch: It's Getting Harder to Retire in America (3-minute film by Griffin Hammond)
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// Griffin’s priority list for retirement savings: //
First priority-Get the free money:
If you or your spouse is eligible for company match on 401(k) contributions, consider maxing out those contributions in every calendar year. The 2021 maximum is $19,500. Hit that first, then worry about other retirement accounts.
Second priority-emergency savings:
Assuming you don't have any high-interest outstanding credit card debt to pay off first-set aside an appropriate amount of emergency savings. Many advisors say 6 months of income, or 6 months of expenses.
Third priority-$6,000 IRAs:
Fund an IRA (individual retirement account) up to $6,000 annually, two accounts if you’re married. These can be tax-deferred (Traditional) or tax-free growth (Roth). Because of the tax benefit-like a 401(k)-these retirement accounts are the priority before making straight-up taxable investments.
Fourth priority-SEP:
SEP IRA has the same tax benefit as a 401(k) or IRA, but because it’s complicated to calculate how much you’re allowed to contribute, it should be lowest-priority. Meaning you’d have to max out $25,500 in annual savings (401k + IRA) before even worrying about funding a SEP IRA (which can be roughly 25% of your self-employed profit).
Fifth priority-Taxable investments:
Only if you have an incredible savings year or have an unexpected windfall-after you’ve maxed out 401(k), IRA and a SEP IRA in a given year-then you could open a regular, taxable investment account, and save any extra there. These are post-tax dollars invested, and when you withdraw them, you pay tax on the growth profit. Good thing about this account: you can withdraw before retirement age without penalty.
// Here are some of the financial products Nick and Griffin rely on: //
Free net-worth-tracking tool-Personal Capital
A useful tool for tracking your retirement savings progress, that also offers some paid robo-investing and wealth management products. Griffin and Nick each recommend the free tool to monitor the health of your savings and investments over time, if you’re willing to receive the occasional sales calls from the company.
*Sign up through Griffin’s referral link to receive a $20 Amazon gift card.
pcap.rocks/griffinhammo
Low-fee digital investing-Betterment or Wealthfront
Griffin uses Betterment. Nick uses Wealthfront. Each allows the ability to open various investment and retirement savings accounts, IRAs, SEP IRAs, taxable accounts, etc. Just deposit your savings, and their robo-investing diversifies your money globally, so you benefit from stock market growth while reducing volatility/risk.
*To waive the 0.25% fee on your first $5,000 invested, sign up through Griffin’s Betterment referral link or Nick’s Wealthfront referral link.
betterment.com/friend-referra...
www.wealthfront.com/c/affilia...
Track freelance expenses and income-Quickbooks Self-Employed
It’s how Griffin tracks his freelance expenses and income throughout the tax year.
*50% off through Griffin’s referral link.
quickbooks.intuit.com/partner...
Nick recommends the financial lessons in “I Will Teach You to Be Rich” by Ramit Sethi
amzn.to/2Y107U4
and the online budgeting tool YNAB / You Need A Budget [34-day free trial].
www.youneedabudget.com/
🎥 Full list of equipment I use:
griffinhammond.com/gear
🎧 I use the music library Artlist:
griffinhammond.com/music
🎓 My 5-hour documentary filmmaking class:
griffinhammond.com/class

[@anthnioncamaroti6653]

I am from Spain, my friend in Texas referred me to this channel you make a lot of sense but I do not understand anything until she referred me to a financial counselor in USA that help me to craft my portfolio and over a year we have been working together making consistent profit enough to get me a new apartment and care for parents.

[@whitemanmark4740]

Hi who is your financial counselor and how does he help? I need your honest assesment.

[@anthnioncamaroti6653]

@@whitemanmark4740 it is not a he. It is a lady. I see most things she says and use to carry out trades are done by Steve. that is how I know she knows what she is doing. in her technique of over night trading she says she use stop loss and take profit strategy. She trade on her account and it reflects on your own

[@whitemanmark4740]

@@anthnioncamaroti6653 Who is she? how can I reach out to her? Can she help me?..

[@anthnioncamaroti6653]

@@whitemanmark4740 ASHLEY AIRAGAHI.

[@anthnioncamaroti6653]

That is her name Look her up on the web, she is quite popular in the U.S and a certified financial adviser.

[@theCameraVille]

This is very informative. Thanks~!

[@ZackTrunzo]

This is a much needed video for many. Thanks for some real world teachings for us creatives.

[@chrisw443]

Missed you guys. My mom's 401k has been useless, so much so we dont even bother with it anymore, it costs too much for us to take money outta it. A good retirement plan is a savings account or a pension. It isnt okay that most americans will never have any retirement. I can tell you right now at 32 I dont think ill have anything saved for retirement till im in my 40's.

[@handulldtd]

I went with a solo 401k over a sep ira, can’t recall why. It sounds exactly the same as what you described, but may be subtly different.

[@KevinSaruwatari]

You guys are young enough that I suggest you think about tax deferral vehicles in another light. With debt ceilings being raised, $3.5T spending bills, etc. keep in mind the government is your partner. The assumption for decades is that your tax bracket will be lower after you retire but it may not be the case in future factoring in the risk for government fiscal mismanagement. You may want to balance investments that don't include an unwanted partner.

[@TheFaustianMan]

Personally, I don't trust any financial retirement plan that doesn't include winning the lottery.

[@ThisWayUpTravel]

Doge all the way!*
*nah 😅

[@adamwesteren3106]

Nick is looking fit!

[@ampsonic]

Thanks!

[@DroiMedia]

You guys make enough to save money?!?!?

[@matthewheimiller434]

Socialism now lmao