How are you saving for retirement?

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Specializes in ER, PCU, UCC, Observation medicine.

This is for all my fellow NPs or anyone who wants to chime in, not sure if this is right location for thread, please relocate if need be.

How is everyone saving for the future? I started my 401k 2 years ago after realizing the biggest financial mistake of my career. As an RN I never started a 401k because frankly I was young and dumb and didn't know too much about them. 8 years later I finally realized a 401k doesn't really change your paycheck by much because the money comes out before taxes. So now I put 10% of my pay a month into a 401k and my pay check may be 300$ lower each month which isn't bad. 3600$ a year I lose after taxes but 12000 goes into my 401k, it's a no brainier now!!

I also have a Roth IRA which by law only allows 5500$ I think each year. This allows me to put post tax money into retirement and any growth I make I can take out tax free after the age of 65 I think.

I started a money market account with a brokerage company as well last year which acts like a retirement account as far as growth but I can touch it at anytime if I need the funds with no penalty.

This is is my PSA to anyone who reads this, don't make the mistake I did, please start a 401k with your employer if you haven't started one already!!!

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Specializes in ACNP-BC, Adult Critical Care, Cardiology.

- 403B

- employer sponsored pension

- pay off mortgage before retirement

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Specializes in Family Nurse Practitioner.

Great topic! We've always lived fairly simply and now that I make a really nice salary are quite comfortable, and will be able to retire in early 60s, knock wood. ;)

1. 403B or 401K-add full amount that our employer matches, which essentially doubles your money even if the choices aren't great

2. Roth IRAs-unable to do them any more because we make too much money but have very nice balances from RN years

3. SEPA IRAs-max when working contractural

4. Paid off house in 10 years

5. Pay cash or quickly pay off cars and keep them until they die

6. Rental properties-not liquid and require babysitting but an amazing investment if purchased in the right neighborhoods

7. Worked at least 30h a week my entire way through pre-reqs, LPN to Masters, quitting work to focus on school has never made sense to me, consider the total income that would have been lost > $450,000.

Its amazing how quickly the years pass so if you haven't been planning for the future please consider starting now.

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Trust Fund

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Specializes in ER, PCU, UCC, Observation medicine.
Great topic! We've always lived fairly simply and now that I make a really nice salary are quite comfortable, and will be able to retire in early 60s, knock wood. ;)

1. 403B or 401K-add full amount that our employer matches, which essentially doubles your money even if the choices aren't great

2. Roth IRAs-unable to do them any more because we make too much money but have very nice balances from RN years

3. SEPA IRAs-max when working contractural

4. Paid off house in 10 years

5. Pay cash or quickly pay off cars and keep them until they die

6. Rental properties-not liquid and require babysitting but an amazing investment if purchased in the right neighborhoods

7. Worked at least 30h a week my entire way through pre-reqs, LPN to Masters, quitting work to focus on school has never made sense to me, consider the total income that would have been lost > $450,000.

Its amazing how quickly the years pass so if you haven't been planning for the future please consider starting now.

In regards to number 2; talk to a wealth management company if you want there is a back door to still invest in a Roth IRA. It involves moving funds from account to account but someone who knows their industry will be able to help you out. My guy does it for me and I make way over the limit.

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Specializes in Family Nurse Practitioner.
Trust Fund

Seriously? If so, very cool.

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Specializes in NICU.

Currently in my early 30s; we fully fund an IRA for me, roth IRA for DH, and the full amount for my 401k. Hoping to go part-time in 15-20 years and retiring another 5-10 after that.

Don't have a house yet, but hoping to buy in the next year or two. Definitely will want to pay off the mortgage before retirement. Have one car that is paid off (had another car, but it recently broke down & decided not to replace it at this time). Still have some student loans from grad school, yuck, but about $32k left out of $60k original balance and DH has maybe $10k in student loans.

I listen to Dave Ramsey (financial guy) a lot. He can get a little preachy and political at times, but his advice is generally sound. I admit that we haven't exactly followed his advice because he recommends going super crazy and paying off all your debt quickly in a couple of years while not putting anything into retirement. That just scared me too much to do plus the growth in these early years is so exponential spread over the next 30 years, so we are paying off the student loans, but not as quickly as he would have it according to his progrma.

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For me, it's IRA, 401k, lots of other small investments here and there over the years that are growing---some better than others. But the least productive investments are the mutual funds. And forget about keeping money in a savings account in any bank---They are already stealing from us with their fees, and soon they will be stealing even more from us with negative interest rates. But I have found that bankers are good people to talk to to find out where the better external investment opportunities are.

I had a dad who did had done quite well financially He made a lot of money. We lived quite well, and spent a lot of that money on a big house and nice things. Then he died suddenly of a heart attack when he was still quite young. It was then that my mother found out about his other women (and children) and that he had been withdrawing large amounts of money from their bank accounts behind her back to finance them. The insurance was just enough to pay off the mortgage and the ridiculous amount of other debts. We were broke, and living in a big house in a fancy neighborhood with no way to continue that lifestyle. We had to sell everything and move. This all went down when I was 16 years old---same year I graduated from high school. It taught me a lot about the importance of money (or better, about the importance of not having it). I got my first job when I was 17, and I've been saving and investing ever since.

Some years ago, one of those mutual fund investment firms came to the job and did a seminar about saving for retirement and I went to listen just to get the latest info. The presenter made the point that statistics show that nurses in particular tended to have unusually high debt to income ratio and little to no savings at all, and that many nurses have had to continue working beyond retirement age because we don't have enough money to retire on. I still wonder if this is true. I thought for a long time about how working professionals could possibly have no savings at all...then I think about the economy we live in today, and, yep, it's possible! I no longer have any faith in Social Security because the way things are going now there soon won't be anything left for anyone to get.

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Specializes in Family Nurse Practitioner.
F The presenter made the point that statistics show that nurses in particular tended to have unusually high debt to income ratio and little to no savings at all, and that many nurses have had to continue working beyond retirement age because we don't have enough money to retire on. I still wonder if this is true. I thought for a long time about how working professionals could possibly have no savings at all...then I think about the economy we live in today, and, yep, it's possible! I no longer have any faith in Social Security because the way things are going now there soon won't be anything left for anyone to get.

Thank you for sharing your life lessons especially with regard to how quickly things can change. I agree 100% about savings accounts and even CDs being fairly useless which is why I sink a majority of my money in real estate.

With regard to the above comment about nurses in general not saving for retirement and having high debt:income ratios I think it is mostly about the unrealistic expectations of our American culture. Everyone, no matter what their income, feels entitled to cable TV, laptops/IPADs/IPODs, large houses, cell phones, expensive cars, designer clothing, regular meals out. It is very expensive to live today however I think our expectations are totally skewed regarding what is a necessity vs a luxury. Living on a strict budget seems to have fallen out of favor as the trophy for everyone mantra emerged. Life isn't fair or easy for many of us and in my experience as someone born with a plastic spoon in my mouth living as if you are white collar when you are barely blue collar is a lose/lose proposition.

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Specializes in PCCN.

curious- does anyone's employer offer as 403b but not match it at all?

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Specializes in ER, PCU, UCC, Observation medicine.
Thank you for sharing your life lessons especially with regard to how quickly things can change. I agree 100% about savings accounts and even CDs being fairly useless which is why I sink a majority of my money in real estate.

.

May I ask what real estate you invest in, apartments townhomes, multi residents, etc and how did you get started ??

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Specializes in Family Nurse Practitioner.
May I ask what real estate you invest in, apartments townhomes, multi residents, etc and how did you get started ??

Townhouses and single family. I got started because I had a friend who was a broker and did investment properties. The best deals are usually ugly that picky buyers won't consider but really only need some updating. Note as a small individual investor its rare to make a huge amount of monthly income like you will see on the infomercials. My minimum goal is to make enough rent to pay the mortgage and build the equity which has been very successful long term. You have to be very particular about the neighborhood and tenants. I also don't ever recommend leveraging your principle residence to purchase anything. Keep your home free in case things go south.

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