Retirement Investments for Freelancers

H friends, I have possibly the most boring question to ever be asked on this forum. How do US-based non-employee freelancers save for retirement?

Specifically, I have a couple zombie 401Ks from Technicolor and CO3 that I really should do something with. From the little I’ve read so far, it sounds like rolling them into a SEP would be the way to go but I’m curious how y’all have dealt with this situation along with how you just save/invest in general.

Also curious if any of you have an investment company that you really liked. I don’t love the companies I use already for my IRAs and mutual funds so I’d be willing to consider someplace new if somebody really likes who they went with.

If you made it this far without falling asleep - thanks!


most retirement advice is heavily influenced by your age… how old are you?

i suspect quite a few uk based flamers would be interested in the answers


The hugest community of helpful personal investment enthusiasts available can be found at Rational, helpful, friendly resource and a great place to ask these sort of questions. Highly recommend the book Bogleheads Guide to Investing. :wink:


Hey Greg,

Imagine the legal lines we would put onto a commercial for an investment firm and apply them to this advice, but…

I have an s-corp, this allows me to have a 401k of my own (through vanguard, which I like very much). I contribute through both my company and as an employee at whatever level my cpa recommends (or that I can afford, in many cases). It’s worked out pretty well, and will continue to even if my freelance clients insist on paying me part time instead of through my company.

Rolling over zombie 401ks is pretty easy, in my experience. I had one from a52 that languished for years, then I wrote an email to accounting, they closed it out, cut me a check, and I dropped it into my new account. Very little trouble at all, and very much worth your time. Fees for those things will cost you a fortune over the long run.


Step 1. Start this today. Seriously get your old zombie 401ks out into a brand new Traditional IRA. Fidelity and or Vanguard are great places to start. Your old 401k is likely sitting in an under performing over expensed mutual fund paying some investment firm a few percent for doing nothing.

If you are a member of VES, you can contact them about a Solo 401k plan and, like Kirk suggested, contribute for yourself and your spouse if you are an LLC and/or S-Corp.

You can also setup a Solo 401k Plan through Fidelity, and probably through Vanguard. With a Solo 401k, you can put in way more than if you were in a traditional 401k, which reduces taxable income quite a bit.

Rule of thumb and in priority, or so I hear…

  1. 6 months emergency savings. Possibly more thanks go COVID.
    1b. Pay down high interest debt.
  2. Max out a Roth IRA
  3. Max out a Traditional IRA
  4. Leftovers go into a traditional brokerage account.

Stick with low cost index funds like VOO that track the S&P 500.


Also, the Personal Finance Subreddit has loads of great Wikis and walkthroughs.

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I’m a big fan of Vanguard, because they have low fees, excellent products, and they’re not as leveraged as their competitors.

I have both a SEP-IRA for my business, and an individual IRA. On years where I bill a lot through my company, I can contribute a lot, tax free to the SEP IRA. Years where I’m on a W2, I add to the personal account. My accountant is kind enough to give me my options, and potential tax savings, before we file my returns.

If you’re fairly young, you can just put everything into an index fund like VTSAX (Vanguard). Your savings will increase at the rate of the overall stock market (and fall with it too). If you’d bought $10k 10 years ago, it would be nearly $40k today. It would be hard to do that well on your own. NYTimes recently ran an article recommending this strategy.

Individual stocks are a bad idea for someone who has a busy life and doesn’t want to be glued to charts and graphs on a screen. But if you really like a company’s long term prospects, go ahead and buy a few shares, and go for the ride. From the Atlantic: “Imagine you’d invested $1,000 in Apple in April 2003, when shares bottomed out at $6.56. Today, those shares would be worth more than $226,000…”

If you want some entertainment, you can follow Wall Street Bets on reddit. I sometimes buy a few shares of the meme stocks, just to watch what happens. I like helping the Davids take on the Goliaths. I’m way up on GME and AMC, but I only put in as much as I feel I can loose. Now that I think about it, maybe I’ll close them out today.

By all means you should roll those 401k’s into your own account. My My brother died almost 3 years ago and I’m still finding accounts that had bits of money in them.

This is not financial advice. Consult a professional.

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This is all great. Thanks! The most confusing thing is managing uncertainty of when income will be W-2 or 1099, so it’s good to hear advice specific to that.

Look into a Cash Benefits Plan. Its a bit convoluted, but it allows you to put away (depending on age) something like 200k a year if you want.

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I have most of the same as whats been said. I have a solo 401k, IRA, HSA and a stock account. Try to always max out the accounts I mentioned first. Vanguard is great and so is Fidelity as I have accounts at both places. But as Randy mentioned above emergency fund 6-12months. I’d definitely recommend the vanguard ETFs, a lot cheaper than mutual funds. Good luck!

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+1 for Bogleheads + Vanguard. You can pay a company a percentage to manage your portfolio, or do it yourself with just three funds and save tons of money. Figuring out where to put your savings doesn’t have to be difficult.

Aim for tax-advantaged accounts first, like IRAs. How you make your money will determine what kind of IRA you can put money into. When I’m W2, it goes into a Traditional IRA. When I’m 1099, it goes into a SEP IRA.

After my IRAs are maxed out for the year, I continue putting money into brokerage accounts I’ve specifically earmarked for retirement.

Or, start a corporation in Ireland, say you’re both the owner and the employee, pay nothing in taxes, and laugh as the povs count their shiny rocks. I am not a financial professional.


Find a good accountant/investment professional that runs the gamut. Its a complicated issue with a lot of different factors and depending on what your goals and risks are that can change the strategy completely. I think and take it with a grain of salt, saying put xx amount of money into a vanguard fund is an over simplification and doesn’t take into account what tax bracket you are in or what it would drop you to, you might just be saving 5% on taxes and that money could be better of working for you in other investment avenues. I have a friend that does tons of real estate rentals and he has fared much better than the market, he buys a rental for every kid for their college fund instead of a tax 525 education plan. Once you start really doing the math sometimes maxing out the 401k doesn’t really make the most return but it is all risk, hence work with someone that you trust and knows the different avenues that might work best for you.


If you’re going to go the adviser route, make sure you get an independent one that you pay for their time. The free ones from Schwab etc are just there to push products on you.

How about Bitcoin? good investment?, … oops bad subject? is it joke? anyone invested?

I believe the term is a fiduciary. As in, they get paid by you not the commissions on silly investment products.

Plus one against the free advice at brokerage services. I had a jerk at Merrill Lynch who cleaned me out. Dumped one stock into my account that dropped over 50% the next day.

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Nearly all “investment advisors” are jokers. If they had any ability to generate above average returns, they wouldn’t be dealing with small potato chumps like us. If you don’t want to manage your own investments, just go with Berkshire Hathway or AAPL.