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Seven Ways to Save for Your Retirement If Your Company Doesn't Offer a 401(k)


A 401(k) is one of the best ways to save for a secure retirement, but if you work for a small enterprise, your company may not offer this perk. The same holds true if you are self-employed. That doesn’t mean you can’t save for retirement on your own. Just like 401(k)s, other vehicles for retirement saving offer tax savings.

1. Traditional IRAs

A traditional IRA is one of the best ways to save for retirement. You can invest your IRA in stocks, bonds, mutual funds, cash, annuities and the like, although the IRS doesn’t permit IRAs to invest in most coins or collectibles. If you’re not covered by an employer-sponsored retirement plan at work, you may contribute up to $6,000 annually to your IRA in 2019, as long as you earn that much during the year, and up to $7,000 once you are age 50 and up. These contributions grow tax-free until you begin making withdrawals. Once you turn 70.5, you must start making “required minimum distributions” from your account, or face stiff penalties.

For those without an employer retirement plan, the entire amount of a traditional IRA contribution is deductible on your federal income tax return. Once you start making withdrawals, the amount is taxed at your regular tax rate.

2. Roth IRAs

While you can’t deduct contributions to a Roth IRA, this type of retirement savings vehicle offers many advantages. Since a Roth IRA is funded with post-tax dollars, you won’t owe taxes on the money on amounts you withdraw in retirement. Unlike a traditional IRA – or a 401(k) – you don’t have to withdraw money from your Roth IRA account upon reaching a certain age, and this makes it a good savings vehicle if you want to pass the money on to your heirs. You can contribute the same amounts to a Roth as with a traditional IRA. There are income limits for Roth IRA eligibility, which change annually. For 2019, you can contribute the full amount to a Roth IRA if single with an adjusted gross income (AGI) of up to $122,000, and make a partial contribution until your AGI reaches $137,000. For those married and filing jointly, you can contribute the full amount if your AGI is $193,000 or less, and make a partial contribution until your AGI reaches $203,000.


If you are self-employed, a Simplified Employee Pension (SEP) IRA is available. For 2019, you can contribute up to 25 percent of your earnings up to $56,000. As with traditional IRAs, you must start making withdrawals by age 70.5.

4. Self-Employment 401(k)

Another option for the self-employed is the self-employment 401(k). You can fund this type of 401(k), also known as an individual or solo 401(k) if your business has no employees other than your spouse. For 2019, you can contribute up to $19,000 to your account, or $25,000 if you are 50 or older. Even better – you qualify as both employer and employee, so as an employer you can contribute up to 25 percent of your earnings up to $56,000 to your self-employment 401(k).

5. Annuities

If you want to ensure that you’ll have a steady income stream once retired, annuities could be a good  choice for some. Basically, you invest in an annuity, and it begins making payments to you in the future. A fixed annuity gives you a guaranteed payout, while a variable annuity pays out according to the current state of its underlying investments.  Be mindful of fees and early withdrawal penalties when considering this option. 

6. Taxable Investments

If you’re able to save more for retirement than an IRA permits, you’ll have to rely on a taxable investment. Look for investments with low fees and low tax consequences, such as index funds.

7. Make Direct Deposits

One of the beauties of an employer-sponsored 401(k) plan is that the money is taken directly from your paycheck, so you really don’t miss it. You can do the same thing with funds aimed for retirement savings. If you work for an employer, set up a direct deposit  from your pay check into some form of investment vehicle. You typically can have monthly contributions sent directly to an IRA or brokerage account.

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten and Fintentional LLC. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.