When you’re a stay-at-home mom, it means you’re also part of a single income family, and we’re at a point in time where most families have two incomes.
If you’re a SAHM, it can seem like you’re somewhat left out of the retirement and investment worlds, but it doesn’t have the be that way. You can be a SAHM and still successfully be an investor, and have a healthy retirement account, but your strategy and approach will be somewhat unique.
The following are some tips to keep in mind if you’re a SAHM interested in investments and retirement options.
Separate Retirement Account
A lot of SAHMs may think their plan is to live on the retirement of their spouse when the time comes, but there are quite a few reasons this might not work out as planned. For example, you may get divorced, or something could happen to your spouse.
However, if you have a spouse who is currently working, you can also create your own IRA, even if you’re a SAHM. There are Spousal IRAs which can be a good option for moms who don’t work outside the home, and if you do get divorced, you’ll still have that account available to you. It’s a great option to give you a sense of stability and security regardless of the scenario that surrounds you at retirement age.
As long as you file a joint tax return with your spouse who earns taxable income, you can contribute a maximum of $5,500 a year to a spousal IRA, and if you’re earning five percent interest, you might have more than $350,000 in thirty years.
Educate Yourself About Investing
The more you can learn about investing the more you can ultimately do with a little bit of money. There are opportunities to invest in the stock market or another place even if you don’t have a lot to begin with, but with concepts like compounding interest you can end up having a healthy nest egg stashed away when it’s needed.
Over time you may also be able to drive passive income through your investments, even having started with a minimal initial investment.
Have A Separate Credit Card
Having credit is extremely important. Let’s say you were getting divorced and you want to purchase your own home. Without credit history that’s probably not going to happen.
A great way to invest in your future, regardless of what that future looks like, is to have your own credit history. You can have a credit card that’s just in your name, which will allow you to build credit over time.
Finally, making a passive income can be a good option for SAHMs as well. This could come from your investments, although that can take time to become substantial. You could look for options such as creating an e-commerce site, a blog, or for something a little less passive that’s still manageable as a SAHM, or you could use your talents to start a small side business. This way you’ll have money that you can contribute solely to your retirement and savings.