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View Full Version : Tip Of The Day - 1/19/06 - Retirement for Self Employed


Sean Adams
01-19-2006, 10:49 AM
I am not a financial advisor - that's why I hired one. At some point (the sooner the better for sure) you will need to come to the realization that when you decide to hang up your boots someday there will not be a pension and gold watch waiting for you. As a self employed person you need to create your retirement options. There are several options - SEP (Simplified Employee Pension), Keogh Plans, New Roth IRA's, Deductible IRA's, etc... The earlier you start to contribute a % of your income to these different options, the less you will have to contribute and the more you will have come retirement age.

Use the net and look around for financial advisors. Try and find a firm that either specializes in or has a specific department that specializes in self employment investing. One of the better moves you will make for yourself, your family, and your business.

olderthandirt
01-19-2006, 11:10 AM
Sean , It should be your main goal in business, if it is an early retirment that you wish everything else you do will be geared to achieve that goal.

Sean Adams
01-19-2006, 11:18 AM
Mac,

Wise words for sure...I think the obvious issue is it is hard for people far off from retirement age to realize the importance of spending the good years of their life not working...it is one of those "yeah, I'll get to it..." things. That money being put away does not produce immediate results or satisfaction and therefore, it is put off. I have always said that I think investing and financial planning should be a part of every regular high school curriculum - if for no other reason than to stress it's importance.

Hard Worker
01-19-2006, 02:03 PM
Sean other than insurance this is one of the main reasons that we have not went full time with our business. Currently my company that I work for full time has a tremendous 401K plan that I contribute to heavily.

I think it would be beneficial to several of us to have a representative or forum set up to discuss these two issues. Would it be possible to have these as sponsors to this site?

These two areas are so.... important in running a successful business, just as important as the equipment we use everyday. What do you think?

Sean Adams
01-19-2006, 05:03 PM
agreed...lemme see what I can do

Hard Worker
01-19-2006, 08:57 PM
Thanks Sean and thanks for such a great site!

cpritch
01-19-2006, 09:22 PM
It's funny that you should mention that financial planning should be a required subject in schools. My husband is a Financial Advisor and is currently trying to implement a community education program concerning the basics of financial planning and investing. He just told me the other night that he thought it was ludicrous that in high school he learned how to make chocolate chip cookies, but was never taught how to invest or plan for retirement when social security is such a concern. He actually specializes in working with self-employed individuals since most of them don't have access to any type of sponsored retirement plans and most aren't aware of what type of plans are available to them. If anyone does have any questions, I'm sure he would be very happy to help. His name is David and he can be reached at 816-804-1822.

Grassmechanic
01-20-2006, 10:43 AM
There are several options - SEP (Simplified Employee Pension), Keogh Plans, New Roth IRA's, Deductible IRA's, etc... The earlier you start to contribute a % of your income to these different options, the less you will have to contribute and the more you will have come retirement age.

Use the net and look around for financial advisors. Try and find a firm that either specializes in or has a specific department that specializes in self employment investing. One of the better moves you will make for yourself, your family, and your business.
This is not only good advice for self employed, but for everyone. EVERYONE who works for a living should be contributing, at a MINIMUM, to an IRA, preferably a Roth. If your employer offers a 401(k) or a 403(b) or a Roth 401(k), you should also be contributing to it, also. If you are relying on SS or a pension to get you through retirement, you'll be sadly disappointed. Financial planning should be a required course in HS. Start early and save often.payup

Sean Adams
01-20-2006, 10:55 AM
Unfortunately we are now a society of material things seemingly dictating your status and we are driven by the desire to accumulate as much as we can... this does not correlate with saving and preparing. We indulge now because we can. Certain members of this site know that back in the day buying a house meant money down - buying a car meant it was the car you would be planning on driving for a decade minimum. If you wanted something you had to save up to get it, and only if you could justify the expense. Even pertaining to this industry...when I first started they wanted blood samples and DNA before contemplating the financing of equipment, etc...

Now....credit cards baby. Buy now, worry later. Our society has learned to deal with and accept the concept of the "back end" because it is not now..... If you have a social security number, the sky is the limit.

jc50292
01-20-2006, 12:19 PM
Sean, have you ever heard of Dave Ramsey? He's a "get out of debt, owe no man nothing but your love" sort of guy. He has his own website, www.daveramsey.com, and he's very good. He's very much for being in business for yourself and yes, he mowed lawns to get his start.

Sean Adams
01-20-2006, 04:22 PM
No, never heard of him but will check him out. I am always interested reading about different money management ideas, techniques, etc... Thanks for the link.

mastercare
02-07-2006, 05:50 PM
I am so glad to see this topic up on Lawnsite. I really hope that Sean can put together a forum for this, which I would gladly contribute to on a regular basis.

You see, I own a lawn business, but my other true passion is financial planning. I earned a degree in Finance from Michigan State University, and work today as a financial advisor. While in college I started cutting grass for some extra money, and by the time I graduated, the lawn business had become too profitable to give up. So, if you get a hold of me during the beginning of the week you'll find that I'm working in an office, if you call late in the week, I'll be cutting grass with the rest of you.

Because of the connection I have with both the financial and green industries, I have naturally become a financial planner who works almost exclusively with small business owners, particularly in the green industry. I handle health insurance, life insurance, business succession planning, and retirement plans for small businesses and their families.

If anyone has questions, or would just like some general information on what their options are, please send me a private message, and I'd be happy to respond.

I can't agree more that its a shame that people don't spend more time planning for their futures. Whether you own a business or you're an engineer; you can be the best at what you do, and its all useless unless you know what to do with your paycheck when you get it home!!!

Wishing all the best,

Freshcut Lawn Care
02-23-2006, 01:29 PM
Another good topic Sean.

I have heard of Dave Ramsey as well. He is very knowledgeable and teaches a lot of common sense stuff!

You guys should check his stuff out as jc50292 recommends!

www.daveramsey.com

Take care guys and gals!

olderthandirt
02-23-2006, 01:58 PM
No, never heard of him but will check him out. I am always interested reading about different money management ideas, techniques, etc... Thanks for the link.

Sean, Rod has come up with a technique for money managment that your probably quite aware of or even mastered the idea. Its most often referred to as mattress stuffin. and it has benefits in 2 ways it provides a place for [stash] your income and the more you stuff it the better you will sleep. A firm mattress has proven to be better for your back thus leaving you more refreshed the following morning. :dancing:
But as I said you probably got your walls covered with stuffed matresses, works as sound proofing as you scream gleefully at us working peons :laugh:

Sean Adams
02-23-2006, 06:29 PM
Sean, Rod has come up with a technique for money managment that your probably quite aware of or even mastered the idea. Its most often referred to as mattress stuffin. and it has benefits in 2 ways it provides a place for [stash] your income and the more you stuff it the better you will sleep. A firm mattress has proven to be better for your back thus leaving you more refreshed the following morning. :dancing:
But as I said you probably got your walls covered with stuffed matresses, works as sound proofing as you scream gleefully at us working peons :laugh:

hmmmm..... mattresssite.com

DUSTYCEDAR
02-23-2006, 06:45 PM
i have seen first hand rod's technique on how to stuff and let me tell u its kinda violent but gets the job done :hammerhead:

nephilim0167
02-25-2006, 10:55 AM
I remember reading in a book about financial planning that when you have a child to set aside 1,000$ in an IRA for them. By the time the retire they'll be millionaires. Unfortunately I dont remember the name of the book, but I'll look for it. I know once I'm at the age where I have children I would like to do something like this for them. As for me being 19 right now, I plan on having a retirement account setup by the time I'm 21. I know it seems like a long time but that's always been my goal since High School. I have a savings account that I contribute to bi-weekly right now that I will use. This is a very important subject to me and should be to all of us wanting to retire and still live with a decent lifestyle. Cheers~

nocutting
03-05-2006, 08:29 AM
I remember reading in a book about financial planning that when you have a child to set aside 1,000$ in an IRA for them. By the time the retire they'll be millionaires. Unfortunately I dont remember the name of the book, but I'll look for it. I know once I'm at the age where I have children I would like to do something like this for them. As for me being 19 right now, I plan on having a retirement account setup by the time I'm 21. I know it seems like a long time but that's always been my goal since High School. I have a savings account that I contribute to bi-weekly right now that I will use. This is a very important subject to me and should be to all of us wanting to retire and still live with a decent lifestyle. Cheers~
Start Early, start young............