Navigating Retirement Savings Without an Employer Plan

05 Feb 2024

In the age of freelancing gigs and side hustles, employer-sponsored retirement plans aren’t always part of the deal. Taking control of your financial future without the corporate safety net is definitely doable; and it’s a must-do. In this article, let’s dive into the steps for your personal retirement savings journey, focusing on long-term investments, understanding your risk tolerance, keeping an eye on fees, and what options you have for where to put your money.

Crafting Your Personal Retirement Plan

No employer-sponsored plan? No problem! Let’s start by sketching out your personal retirement roadmap. Set your goals, commit to your financial wellness, and figure out how much you need to invest for your retirement. It’s like making a bucket list for your bank account!

Investing for the Long-Term

Long-term investing is a little like a set it and forget it plan. Forget those short-term ups and downs; we’re in it for the marathon, not the sprint. Diversify your portfolio, and probably choose something a little riskier if you still have a lot of time in the market before you retire (more on this later). Trust us; time is your friend when it comes to building that sweet retirement fund.

Understanding Your Investment Horizon

Think of your investment horizon like planning a trip, the closer you get to the destination (retirement), the smoother the ride should be. If retirement is on the horizon, maybe ease off the adrenaline and risk and opt for a more leisurely, or less risky, investment strategy. So, when you’re starting out your career and investments for retirement, you’ll have more time in the market so you can afford to take on more risk because you’ll have time to make up from losses but as you get closer to retirement you want to take on less risk because any drops in the market will have less time to recover. You can read more here about why time horizon is important for choosing your investments.

Adjusting Risk Tolerance

Risk tolerance and investment horizon go hand in hand, essentially your risk tolerance is how much risk you’re willing to take on. Reevaluating your stance regularly to make sure your goals will be met is a good habit, especially as retirement gets closer so you can change your portfolio to take on less risk.

Fee Management

Fees can eat up a large amount of your returns so of course it’s best to choose a portfolio with the lowest fees and make sure you exactly what those fees are for and even how much your total fees will be. Opt for investments with clear fee structures that won’t sneakily eat into your returns, find out if there are any extra trading fees, entrance and exit fees or other service fees. Which leads us to a shameless self-promotion: The LifeGoals PEPP.

The Pan-European Personal Pension Plan (PEPP) is regulated by the European Insurance and Occupational Pensions Authority (EIOPA) and has a regulatory fee of 1% for the LifeGoals Basic PEPP. It’s the newest way to save for your retirement safely, at a low cost with or without an employer sponsored retirement plan. You can join the waitlist now so you’ll be the first to know when it’s ready for your investment.

No employer-sponsored plan? Don’t stress! Take control of your financial future with a personal retirement plan that’s easy to sign up for, has low fees and fits your risk level. From the long-term investment marathon to adjusting your vibe as retirement approaches, managing fees, and exploring the PEPP scene — it’s all part of the plan.