Assuming I get my dream post-doc next year, I will be making 2x my grad salary…and none of it will be eligible for retirement savings because it will be a stipend instead of wages. That will be my life for at least 3 years, though hopefully not much more than that. I want to start saving for retirement in earnest – how would you do that in my situation?
This won’t matter too much until 2018, because in 2017 I’ll have earned income as a grad student that will let me max out my Roth, at least.
- Get married to someone with earned income
- Get some earned income (addendum to her recommendations: if you do any consulting or freelance you can save that in a self-employed plan such as a SIMPLE IRA)
- Don’t save for retirement (do other saving money things instead). Then start saving more than you would otherwise for retirement once you get earned income and a savings vehicle to use.
In graduate school I was married so if at least one of us had earned income for half the year we were ok for IRA/Roth IRA, especially since the contribution limit was much lower at the time ($3K).
In case evolvingpf’s post disappears, good recommendations for non-retirement savings include:
- If you’re in the 15% income bracket (or lower) now is a good time to use taxable stocks, especially dividend heavy ones because of the preferential treatment of capital gains. Put that money to work for you. (Note though, it is unclear what will happen to taxes over the next few years.)
- Pay off all debt starting with high interest (I bet you’ve already done this)
- Bulk up your emergency fund
- Save for your next car or a house so you can pay in cash for the car and get beneficial interest rates (and no PMI) for a house
Grumpy Nation– what suggestions do you have for someone without earned income who wants to save?