Issue link: https://www.massageandbodyworkdigital.com/i/969285
A B M P m e m b e r s e a r n F R E E C E a t w w w. a b m p . c o m / c e b y r e a d i n g M a s s a g e & B o d y w o r k m a g a z i n e 93 remember to transfer the money. It's just a regular expense that takes care of itself on a monthly basis. Rollovers A rollover is when you transfer the money from one retirement account into another. Rollovers are most often used when someone leaves a job. The most common scenario is that they would take the old 401(k) and roll it into an IRA. Unfortunately, when most people leave a job, they let their old 401(k) just sit there gathering dust. Don't be that person! Without the match counteracting it, the fees tacked onto your old 401(k) can add up and stunt the growth of your account. If you have ever held a previous job before massage and you had a 401(k), be sure you roll it to an IR A. It can help you stay organized and can end up helping you get a better return on your money. GETTING STARTED Is your head spinning? No worries. Let's keep it simple. Here are my recommendations: • If you're a solo practitioner with no employees or employees who work very little (contractors don't count as employees), then I would start with a Roth IRA. If you max that out and want to contribute more, set up a solo 401(k). • If you work at a spa or massage business, invest in their 401(k) up to the match and then put the rest into a Roth IRA. • If you own a massage business and have W-2 employees, consider a Roth IRA, SIMPLE IRA, and/or standard business 401(k). • Whenever possible (barring some specific exceptions), choose Roth! Remember: you want to pay taxes on the seeds, not the harvest. HELP, THIS IS ALL VERY INTIMIDATING! OK, I get it. Money is scary. We all have questions like: • How will I ever save enough to retire? (Regularly) • I'm barely making my bills right now, how can I save for retirement? (Carefully) • Can't I just worry about it later? (No) • Won't the government take care of me when I retire? (Also no) These are all valid questions. The thing to remember is that nobody suddenly flips a switch and has all their retirement savings taken care of. Saving is not a one- time event; it's a slow, gradual, consistent habit. If you don't know where to start, set up a Roth IRA and contribute $50/month to it. After a few months, see if you can increase it to $100/month. Then $150 and so forth. Start small and work on your budget so you can get to where you want to be. It also helps to think of monthly numbers in terms of massage sessions. For example, maxing out your Roth IRA is great, but $458/ month sounds like a lot of money. However, if you think of it as six additional massage sessions a month, it seems more attainable ($458 ÷ $75 for a session = $6.1). Can you hustle and do six more massage sessions in a month? Probably. Also think about your retirement contributions in comparison with your car payment. Most of us don't give a second thought to buying a car on a loan and paying $200–$300 a month on car payments, but for some reason we balk at investing that much into our future. Being willing to rethink your habits and priorities puts you ahead of the pack and in good shape for a healthy financial future. Don't delay your retirement! Make it a priority. Most massage therapists (well, most people in general) don't think about it and let fear of the unknown keep them from planning for their future. Take control of your retirement planning and set yourself up for comfort and peace later in life. You're worth it. Notes 1. DaveRamsey.com, "How to Invest in the Right Mix of Mutual Funds," accessed February 2018, www.daveramsey.com/ blog/how-to-invest-in-right-mix-mutual- funds. Allissa Haines runs a massage practice and collaborative wellness center in Massachusetts. She partners with Michael Reynolds to create business and marketing resources for massage therapists like you at www.massagebusinessblueprint.com. The thing to remember is that nobody suddenly flips a switch and has all their retirement savings taken care of. Saving is not a one-time event; it's a slow, gradual, consistent habit.