It’s no secret here that our current money struggle is retirement. I mean, we know that we should save for retirement and we know that in order to save for retirement it should go into an IRA since we’re a self-employed household. But seriously, this whole world of investing has been pretty scary. 

I mean, how do you invest? Where do you get started? What banks/companies should you use? How much do we need to invest every year to hit our retirement goals?

And the list of questions just keeps going on. 

We’ve been working hard this year to get this whole thing figured out. I may have an accounting degree and took an investing class in college but it was one of those, “learn the material for the test and then quickly forget it” type of things. So truly, I didn’t really learn anything in that class beyond that we should save for retirement and make sure to take advantage of our employers’ match program with our 401(k)’s. 

So, yeah. Nothing ground-breaking. And since the world of employer-matched 401(k)’s is now out the window for us since Pat and I both own our own businesses now, we’re left to figure out this whole investing thing by ourselves. 

And in my true nature, I thought I’d share this new journey with you. Now, it’s important to note that we don’t plan to truly maximize this until we finally get the mortgage paid off…which we’ll hopefully meet our goal of having that paid off by the end of this year. 

Here’s every resource that we’re using for this:

Unshakable by Tony Robbins

The knowledge of my friend and CFP, Natalie Bacon (you can read this amazing post about retirement that Natalie did for me here.)

Mom and Dad’s Investment Guide

Here’s what we’ve got so far:

For now we’re only focusing on my retirement account because my husband’s 401(k) is still tied up in the business he used to work for due to a holding period they have. So my ROTH IRA’s combined only started with: $3,297.33.

Yes, I know that’s a terribly sad number to have set aside for retirement when you’re 31 years old. And in case you’re new here, we actually broke a “money rule” when we were working hard to pay off over $55,000 of debt in two years. You can read that whole story here which explains why that number is so sad. 

Okay, so we just started putting my ROTH into the investing world (as like a week ago) so there’s no impressive “we’ve gained this much” story to share with you yet. But below lies out our plan, which we came up with after having a “date night” meeting using Mom and Dad’s Investment Guide – seriously, it’s the $20 I’ve spent in a long time. He even has a calculator that will help you figure out just how much to set aside for retirement. 

Here’s the plan:

Okay so based on our calculations and a retirement age for me of 65, we need to set aside just over $10,000 a year towards retirement and our asset allocation needs to 70% stocks and 30% bonds. This is why we have two ROTH IRA’s for me and one for my husband, since the contribution limits are set to $5,500 a year for a ROTH IRA – meaning that we can only add up to $5,500 a year to one account. 

And since we’re supposed to set aside over $10,000 in my ROTH, opened up two accounts – one with just over $3,000 and one with $200. Which means that we don’t have very much money to work with starting off and our asset allocation is jacked up because right now, my account is 100% invested in the US Stock Market. The reason for this is to work to build up the $200 account in order to reach the minimum to invest in the funds we’re looking at.  

And the plan is to have 70% stocks and 30% bonds and then to be even further diversified by having those investments spread out among the US and International stock and bond markets. This is to avoid having all of our eggs in one basket…which unfortunately is what we have now. 

The fix:

In order to invest more, we’ll have to put aside another $3,000 in the account to invest again. This won’t likely happen until closer to the start of the school year since we have to fork over quarterly taxes this week, but hopefully we’ll make it happen sooner rather than later. 

Also, it’s important to note again we’re not aggressively pursuing this until after the house is paid off since we’ll be 100% debt-free at that point and we’ll have more money to work with. And other shorter term investment that we’re using is Acorns. We started it off with $100 and in just over a month of using it we’ve increased that account to over $270! 

Granted, we’re not planning on retiring with this investment account but it’s a nice little bonus. And heck, every little bit helps.