No 401k at Work? How to Save for Retirement

No 401(k) at Work? 4 Other Ways to Save for Retirement


Written by John Rothans

Jul 15, 2020

Contributing to an employer-provided 401(k) retirement plan is often touted as one of the best retirement strategies.

However, approximately 55 million Americans don’t have access to such a plan.

Are you among those with no 401(k) at work? If so, it’s still possible to take charge of your retirement savings—sometimes with options that offer more flexibility and freedom. Here are a few other ways you can safeguard savings for your golden years, even if you don’t have a 401(k).

Retirement Savings Routes to Consider

Traditional IRA

A traditional IRA allows you to save for retirement by paying taxes later.

  • Contributions are either entirely or partially tax-deductible; tax deduction eligibility depends on factors such as salary level and participation in an employer-sponsored retirement plan.
  • Withdrawals in retirement are taxed, including earnings and gains. Additional taxes are applied if funds are withdrawn before you’re 59½ years old or if you don’t begin to take minimum distributions by April 1 of the year after you reach age 72 (70.5 if you reached age 70.5 before January 1, 2020) according to the IRS.

“The traditional IRA’s key advantage is that it allows an individual to make annual tax-deductible contributions to one’s retirement fund,” Money Crashers notes.

Roth IRA

A Roth IRA allows you to save for retirement by paying taxes now.

  • Roth IRA contributions are taxed.
  • Qualified withdrawals are tax-deductible if the account is at least five years old.
  • Earnings from a Roth IRA account are free from federal taxes and—depending on the circumstances—potentially state and local taxes, too.
    As long as you’ve had the account for more than five years, you can withdraw contributions you’ve made to your Roth IRA at any time—tax- and penalty-free. However, you may be required to pay taxes on earnings in your Roth IRA if you withdraw them before age 59.5.
    You may withdraw Roth IRA earnings without penalty in situations such as a first-time home purchase and select medical expenses as long as it has been five years since you first began contributing.

“The greatest thing about Roth IRAs,” notes Dave Ramsey personality Chris Hogan, “is that you don’t need to [put in] a ton of money to open an account. In fact, the IRS doesn’t require a minimum amount to open a Roth IRA.” That fact can make it super simple to get started on a path to retirement when you don’t have a 401(k).

Precious Metals IRA

A Precious Metals IRA (a Self-Directed IRA that includes physical gold and silver) empowers you to control account specifics and enjoy an expanded asset selection without having to rely on a workplace association.

You can focus on stocks and bonds or broaden your scope to include real estate and IRA-approved precious metals.

Such precious metals can include gold and silver coins, bars, and rounds that meet strict Internal Revenue Code requirements such as:

  • A minimum fineness of .995
  • Production by a national government mint or accredited producer

A Precious Metals IRA thus provides a higher degree of flexibility and personal input than many other options available. It’s also considered by many to be a good hedge against both inflation and unpredictable financial crises.

Brokerage Account

Awareness and use of brokerage accounts is on the rise.

“Over 40% of U.S. investors said they had a brokerage account in 2018, compared to 31% in 2012,” according to a May 2019 report from investment data research firm Hearts & Wallets.

Like a Precious Metals IRA, a brokerage account can offer users control and flexibility. Unlike the other 401(k) alternatives mentioned, a brokerage account is viewed by some experts as better suited to producing a source of income than retirement savings plans.

That’s because, among other regulations, brokerage account holders must claim annual gains earned and losses accrued in their taxes.

“The biggest disadvantage to a brokerage account is that it’s not tax-advantaged,” notes Fool.com. “You’ll have to pay taxes on earnings in your account, including capital gains and dividends.”

Those earnings may be set aside as retirement savings. Still, the critical aspect of a brokerage account is ready access to your money—not the retirement or tax benefits related to such a savings plan.

Meeting Your Retirement Needs

You have retirement options when no 401(k) is available from your employer.

You can have full control over your portfolio’s asset allocation when you open a Self-Directed Precious Metals IRA.

“Consistent, dedicated saving might not be glamorous, but it will give you far more freedom and control over your lifestyle down the road,” Vanguard advises.

Call U.S. Money Reserve for a free one-on-one consultation to discuss your retirement goals and learn how precious metals can help you reach them.


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