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How to Save for Retirement as a Freelancer

Saving for retirement as a freelancer

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Cecile Corral had been feeling optimistic about her retirement savings. For a decade, she was making good use of an employer-sponsored 401(k), contributing 6 percent of her salary and receiving a match of as much as 6 percent. Before she had children, she had been saving nearly 10 percent of her paycheck.

“My retirement savings plan was basically on autopilot, and I didn’t worry about it,” said Ms. Corral, of Miami.

That came to a screeching halt in May 2020. A casualty of the pandemic, she was laid off after 20 years as the senior editor of a family of trade magazines. It was a shock to her system — and her finances.

“I needed to make sure that our bills got paid and that my husband and two children had health insurance,” said Ms. Corral, 48.

Ms. Corral’s husband had been a freelance documentary film producer for the last 10 years, and the family had health insurance through her employer. The household was suddenly supported by two freelancers rather than one.

Soon, Ms. Corral began offering freelance public relations and marketing services. But with new expenses for the family and her business, and no paycheck, saving for retirement had to go on pause.

“Even though I had some time until I retired, I was worried,” Ms. Corral said. “I knew I needed to find a way to start saving for retirement again.”

Saving for retirement as a freelancer is much different than it is as an employee, said Ben Henry-Moreland of Freelance Financial Planning, an independent financial planning firm that specializes in working with the self-employed.

“The single biggest obstacle to saving for retirement as a freelancer is the fact that you need to take the initiative,” he said. “You need to put aside some money, determine what type of retirement vehicles you want to use, then you have to find a provider or providers.”



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