SEP IRA and retirement in general

Mainly directed at the self employed, but all input welcome.

We're LLC 's' corp, and I started looking into a SEP. We're a partnership, and I am paid about $25k on W2 from 'the business' - I'm going to run this past our CPA but am pretty sure we can contribute to this vehicle.

Goal is to exceed the $5-6 k limit each in the current 401k/ROTH plans we have, which are split - one third of the limit to ROTH, 1 third to 401k. Each - that is.

I'd be happier with about $12k total - $6k SEP, $4,500 401K, $1,500 Roth.

We left ODFL with $140k odd in each, in 2015, and didn't contribute anything until 2021, after 8 years owner operator, with Gretchen not working, balances are at about $180k 401K, and $8k Roth (Again - figures are the same for both her and I).

Last year as we all know was disastrous for retirement accounts, and had me wondering if buying 10-50 acre agricultural/rural sections, and paying on a mortgage for them, would be better than sinking money into retirement plans where gains were not to be found at all. Land - undeveloped, seems to consistently gain in value, with little expense. Property taxes are reasonable, and land can be rented for pasture or crops enough to offset the taxes and a little on the mortgage interest.

House/vehicles/equipment is paid for - but you always need a roof overhead and tools to generate revenue, so I never view net worth of assets as anything productive for passive income. We had residential rentals but sold them due to a long term dismal outlook on returns vs. risk in our area. And having become tired of feeling like a welfare provider most times. That money just sits there being eroded by inflation, hence my interest in land purchase as a safer haven for loose cash.

I don't really see retirement, unless I simply become too weak to work for whatever reason, so intend to do so as long as I can.

I played with the ssa.gov numbers, and it's clear that doubling the current wages we pay SET on has minimal effect on projected SS income - about $150/month , and simply delaying withdrawal from the program (if it still exists 20 years from now) generates a far higher monthly number.

Just wondered what everyone else in a somewhat similar situation, either now or in the past - has elected to do for savings/retirement.

P.S. - Just watched that Bernie Madhoff documentary, and yeah - not interested in anything like that. You can keep your cryptocurrency too.

 

Hey - you won't hear me hating on can collectors !

 

I've ben fighting with myself and Gretchen on it - 'dollar cost averaging' (I think is what they call it), contributing steadily (The ROTH is weekly, the 401k only allows monthly) - to allow you to buy in segments when the market is high or low.

I can see the math in it, but it's depressing to see what you invest either stagnate or dwindle in the current (short term view) market.

 

Absolutely - I find it interesting to find folks like you in your 30's with some form of portfolio established.

The REIT piqued my interest a couple of years back - basically a 'hands off' approach to real estate investing. Some of it came when a flood of communications came when I listed one of the rentals, and when I got to a person that could explain it - revealed a shift in rental management.

Morally it didn't appeal to me, but, like said - we felt like welfare program participants when we owned rentals and held the belief we were contributing to a community in offering decent quality , affordable rentals. There's only so many years you can withstand renovating houses unnecccesarily due to (even well vetted) tenants.

I'll have to look further into this one.

 

Again, also interesting.

I recall a guy we met at ODFL - back in 2010 - he was retired from YRC after 20 years, wanted to keep working, and said he received $2k monthly from his YRC pension and the stipulation was that he no longer worked for YRC (or union company? I forget) to receive it. So he earned $4k plus at ODFL and his $2k pension, and was close to drawing SS.

I guess these are first world problems.