This short reader post from GRS reader A Single Saver caught our eye. A 401(k) or IRA fund seems almost mandatory by personal finance standards, and yet, here a reader writes how her retirement looks good without them. What do you think? Would you be able to provide a retirement for yourself without retirement investment accounts?
Can a single woman retire without a pension or a 401(k)? That was my dilemma. As a contract worker, my job gives me neither of those, and Social Security may not be around in the future.
Making $60,000 to $80,000 a year without deductions, I paid a small fortune to Uncle Sam. I spent freely since I felt I could never get ahead anyway. It took me until my late 20s for the light bulb to come on. My first gray hair said the future was coming whether I was ready or not. What could I do? I had to start saving at some point!
I read everything I could get on finance, budgeting and saving. Some ideas worked, some didn't, but the main key was obvious: Spend less than you make. Forced frugality brought results slowly, and eventually the irritation I felt from delayed gratification diminished as my bank account grew.
I thought and read even more, and decided becoming a landlord seemed a way to security. I scratched and saved and bought my first home at 30, took a chance and moved to a fixer while renting the first. Sold the second three years later, used the profit to pay down the first by a third, bought a third house. It was really hard, but skipping the ads on TV, ignoring fashion and having a decent used car helped. Seeing even small progress toward my goal gave me hope.
It seemed like forever, but 18 years later, I own three homes outright, and have plans to pay off the fourth in seven more years. At 48 and unmarried, it seems frightening to not have a pension or a 401(k), but the income from the four rental homes (I will live in the fifth) should help me ease into retirement by 58. You can do it. By focusing only on buying the necessities (with a few splurges here and there), saving becomes a habit that you don't even notice, one that provides a lifetime of results!
So, readers, how are you saving for retirement? If you're using an unorthodox strategy, like A Single Saver, tell us about it.
Author: Ellen Cannon
Ellen Cannon was the editorial director of the financial services sites at QuinStreet from 2010-2015. She has covered personal finance for magazines and websites for more than 20 years, including five years as managing editor of Bankrate.com. She lives in South Florida with her kitty and sunshine.