Your money | Trading, Personal finances & Savings

Your money as more us workers go independent, a retirement time bomb is


´╗┐retirement savings, and a shocking number give exactly the same answer: "What retirement savings?"The potential consequences are scary not only for them - the nation's growing ranks of entrepreneurs, freelancers, consultants and contractors - but also for the United States as a whole. With more and more people without regular jobs and the benefits that come with them, the nation faces a retirement time bomb. New data from TD Ameritrade Holding Corp reveals the worrisome state of the retirement savings of independent workers. The brokerage company's Self-Employment and Retirement Survey found that 28 percent of the self-employed were not saving anything at all, and another 40 percent were only saving occasionally, when they said they were able. At the same time, the ranks of U.S. freelancers, contractors and temp workers are growing every year - to an estimated 40 percent of the workforce by 2020, according to a study by software company Intuit, and up from 30 percent in 2006, according to the Government Accountability Office."This is going to be a huge problem," says Jonathan Medows, a Manhattan certified public accountant who specializes in helping freelancers with their finances. "They are already struggling to pay their bills, and then there are all the additional costs like overhead, like quarterly estimated taxes, like medical care. And cash flow can be so inconsistent that it is very challenging to budget."Until a few years ago, saving was not on the agenda of New York City disc jockey Herbert Holler (real name Ken Hyman). Early in his career, he says, "I was single, living on the Lower East Side, going out every night and living day-to-day."But now Hyman is 37, with a wife and a young daughter. Despite intermittent paychecks, lack of company-sponsored 401(k) plans and matching contributions - plus additional cost burdens like health insurance - he and his wife are maxing out their annual Roth individual retirement account (IRA) contributions."Freelancers have to find a way to save," Hyman says, "or we're all going to be in a lot of trouble."

SAVE MORE Even though the U.S. retirement system has not really been designed for them, freelancers must take responsibility and drastically up their retirement saving using the investment vehicles most appropriate for them. If you are that rare freelancer with a big profit margin at the end of each month, then a Simplified Employee Pension Individual Retirement Account (SEP-IRA) is a golden tool, advises Denise Kiernan, co-author of "The Money Book for Freelancers, Part-Timers, and the Self-Employed."

The self-employed can set up this version of a traditional IRA themselves. You will reduce your taxable income for your efforts, and the contribution limits are much higher than for traditional IRAs - 20 percent of income, or $52,000 (whichever is less) in 2014. Consult IRS Publication 560 for more details. If money is tight, a traditional IRA or a Roth IRA will probably give you enough room to save, and might be easier if you already have accounts set up. Each currently offers annual contribution limits of $5,500 (plus an extra $1,000 for people over 50). The choice becomes whether you want to get a tax break now, with a traditional IRA, or have tax-free earnings with a Roth. You cannot fully fund both at the same time; CPA Medows suggests using a Roth whenever possible. CONTRIBUTE DIFFERENTLY

But with freelance cash so inherently erratic, how can you contribute enough retirement money?Brooklyn magician Evan Paquette is a fan of personal-finance expert Ramit Sethi's "envelope" system of apportioning percentages of whatever money comes in to different goals, like basic expenses, entertainment, or retirement saving. Most financial institutions allow you to set up an automatic withdrawal into a retirement account, or they can send you a digital reminder to make a contribution each month or at certain times of the year."That way, whether you're making $100 a month or $10,000 a month, money is still getting put towards the retirement goal," says Paquette, 30, who uses a SEP-IRA to house his retirement assets. "Even if it's only $5, at least it's something."Retirement experts are looking for ways to make this automation easier for non-workplace savers. One idea before Congress now is an "automatic IRA" that citizens would have to opt out of, rather than figure out for themselves. This has worked well in the United Kingdom, says Shlomo Benartzi, a professor at the UCLA Anderson School of Management and chief behavioral economist for Allianz Global Investors. California has passed such legislation at the state level, although it has not yet taken effect. Whatever happens to help freelancers start saving, Benartzi says time is of the essence. Since only roughly a third of all Americans are contributing to 401(k)s right now, society has to get freelancers on board, or the retirement-savings system will become even more broken than it already is."We don't have to wait to see a retirement-savings crisis develop," he says. "We already have one."

Your money the undercurrent in weddings and marriage money is taboo


´╗┐The couples interviewed in the new documentary "112 Weddings," which premiered on HBO in late June, don't talk openly about money. There are sideways glances and pained looks, but as they reminisce about their weddings and talk about how their marriages have gone, they simply do not go there."It's the thing that people are least eager to talk about," says documentary filmmaker Doug Block, who has freelanced for the past 20 years as a wedding videographer. Block reconnected with some of his clients for the film. Block's other major works are also highly personal - "51 Birch Street" and "The Kids Grow Up" both feature his family - and he is a character in this one, too. Married for 28 years, he says he is something of a confidante and comforting presence to the bride and groom while he is filming, and they are always asking him questions about marriage. Here are some of his this site: Did you notice any correlation between the way the couples are during their weddings, or what they spend, and their happiness later on?A: A few told me they wished they hadn't spent as much on the wedding - they could use the money now. But I don't think you can extrapolate anything from what people look like on their wedding day. Some people may be shy or others used to public displays of attention. Even when I felt like I got a really good vibe from them at the wedding, you never know. There was one couple that seemed so solid, and four years later they were divorced. I know in that case it was a money issue. Q: What over-the-top touches did you see as you filmed?A: I want to come back in the next life as a florist for weddings. The amount of extravagant bouquets! I'd shoot church weddings where flower arrangements were down the entire long aisle.

People were getting the Rolls-Royces and carriages for the transportation to and fro. And the wedding cakes, oh my God. I saw some wedding cakes that were the equivalent of a first year of college education. Q: When you went back to find couples to interview among the 112, how many didn't make it?A: I got in touch with about half, and of those, less than 10 percent were divorced. I attribute that to my great karma. Q: Among the ones who are having trouble, what did you interpret as the reasons?

A: What they are not saying is more revealing than what they are. When one woman who was laid off, brings up, "We're not doing quite as well as we used to," you see the look. And another couple (where the wife doesn't work and they have a daughter with learning issues) it's so clear that stuff is not being said, and they are being evasive. What's revealing is the silence, and the expression they have when they are not talking. Q: As an award-winning filmmaker, how much did shooting wedding videos contribute to your finances?A: Documentary income is so inconsistent. If I'm in production, I'm getting salary for the editing period. For those years, weddings were maybe a quarter of my income; other years it's a half or more. I've tried to limit it to between six-nine weddings a year.

One June, when I was editing "51 Birch Street" to get it ready to premiere at the Toronto Film Festival that September, I got in seven weddings - I double dipped doing Saturdays and Sundays. You can't turn these things down. Q: Do you like weddings?A: Weddings are so sociologically interesting. Often, it's done as much to impress as it is to have a good time. And I get caught up in them - if the emotion is there. The only problem I have is when the couple decides they're not going to get emotional. I don't get that at all. Of all the days in your life when you can express your feelings and love, hey, it's your wedding day. Q: What's your best wedding advice?A: Rather than fall intro trap of going the traditional route, do what would be fun for you. I'm surprised more people don't turn it into a weekend retreat or play volleyball at a lake. Some weddings I shot are like that, and everyone seems to be having a wonderful time. Others, people can't wait to have a drink and get out of there. Q: Do you plan to keep shooting wedding videos?A: Oh yeah, and my price is going up.