When you are working hard building and running your own business, it’s easy to push retirement planning off to the side. Especially if you’re inclined to pour profits back into growing the business.

That said, one of your smartest moves is to fight the temptation to back-burner retirement planning. The sooner you hatch a plan and begin to work toward your savings goals, the easier you will make it on yourself. 

Retirement Tips for the Self-Employed

1. Don’t Rely on a Big Cash-In. If you’ve built a thriving business, perhaps you are eyeing selling it at some point and using the proceeds to jumpstart your retirement savings. That can indeed be a viable option, but it’s worth stopping for a few minutes and thinking through the consequence of what would happen if five years from now or 30 years from now, your business is no longer as robust, or you can’t sell it for near what you had anticipated. The responsible move right now is to keep thinking there will be a nice pay day down the line, while also starting to set aside money in retirement accounts. Either way you will be in solid financial shape.

2. Pay Yourself First, Even When You’re an Entrepreneur. Saving at least 10% of your income each year in retirement accounts is not merely a goal. It should be a necessity. You can’t say you can’t afford to save if you haven’t even tried.

3. Roth IRA: The perfect self-employed retirement account for annual contributions of $6,000. The 2019 contribution for Individual Retirement Accounts is $6,000, or $7,000 if you are at least 50 years old. 

If saving $6,000 in 2019 in a retirement account seems like close to your limit, a Roth IRA can be a good option. You don’t get to deduct your contribution, but your money grows tax-free, and in retirement withdrawals will not be taxed. That can be a nice edge over Traditional IRAs, where in return for a possible upfront tax break (it depends on your income) you end up paying income tax on every penny you withdraw in retirement.

Roth IRAs also have a nifty emergency feature for entrepreneurs. The money you contribute to a Roth IRA can be withdrawn at any time without owing any tax or any penalty. To be clear, just the money you put into the account can be pulled out at any time. The earnings (gains) on your contribution will be taxed and hit with a 10% early withdrawal penalty if you take that money before you are 59 ½.

While your goal should always be to leave your Roth IRA savings untouched until retirement, knowing you have easy access to the money in a true emergency can be reassuring, especially if you are still building your business.

The one catch is that your income can’t exceed certain limits to be eligible to save in a Roth IRA. In 2019, individuals with modified gross income below $123,000 and married couples with income below $193,000 can make $6,000/$7,000 contributions to Roth IRAs.

Get Double-Duty Out of an HSA. Your health insurance could also be a valuable way to save for retirement. Unless you are on a spouse’s workplace insurance plan, chances are you are paying for your own individual health insurance. If you have ample savings a High Deductible Health Plan (HDHP) may be a smart cash-flow move, as the premium will be lower than other types of plans.  (You just need to be sure you have the cash to cover the higher deductible.)

The even bigger payoff for the self-employed is that once you enroll in a HDHP you are allowed to contribute to a Health Savings Account (HSA). An HSA offer a rare triple-tax-break. You can deduct the money you contribute to an account, the money then will grow tax-free while it stays in the account, and when you make a withdrawal to pay for a qualified health-care expense you will owe no tax.

Here’s where retirement comes into the picture:  Money you save in your HSA can be used right now to pay for current health-care expenses. Or you can treat your HSA like a stealth retirement account:  leave the money untouched and it can keep growing. Then in retirement, you will have a large stash of savings that can be used tax-free to pay for medical expenses. Access to tax-free dollars is surely something every entrepreneur knows to value.