How to Actually Save for Retirement as a Busy Working Mom

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Tracy Bingaman

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I'm a PA who burned out, big time, and now I teach PAs to negotiate effectively because every PA deserves a paycheck they are proud of and to feel valued at work. I love leopard print, skiing, and my morning routine. My mission? To help PAs stop feeling overworked, underpaid and overwhelmed and start feeling valued and earning what they deserve.

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The most exciting topic in personal finances, the scoop on retirement investing. Here’s what you actually need to be doing in order to effectively saving for retirement!

There are three elements to successful retirement savings and we are going to go into each one in detail today. They are 1) being prepared 2) saving consistently and 3) investing that money well. 


First things first, you’ve got to do the PREP to make sure that you are ready to start investing and saving for retirement. Yes, of course the earlier you start saving the better. Compound interest is your best friend! Saving sooner rather than later is key and I know it’s so tempting to throw your budget, your debt payoff out the window to save aggressively for retirement… oh, that’s only super nerdy finance folks? 

The best time to save for retirement is once you’ve paid off all of your debts (except that pesky mortgage) and saved an OMG Fund – a fund to be used just for emergencies. I recommend your omg fund to be 3-6 months of household expenses. This will help you when these inevitable emergencies crop up. It helps you avoid slipping back into debt when life happens and life. Always. Happens. Rainy days are coming… it’s not if, but rather when. By having this fund as a cushion between you and life you avoid the costly mistake of having money in retirement that you can’t and shouldn’t withdraw to cover those emergencies. 

Yep, I know that by doing this prep work and pausing or not starting your investing in retirement until you’ve got your debts paid and your OMG fund locked and loaded. It can seem as though you are “missing out” in investing in the market while you are getting your ducks in a row – and by that I mean paying off all debt, student loans, credit cards, car payments, leased vehicles, boats, RVs, jet skis, adoptions, sheds… you get the picture… paying off everything but the house & funding that OMG fund. I recommend that OMG fund lives separate from your everyday savings account and checking account so that you don’t accidentally spend it at TJMaxx. Yep, been there, done that! We keep ours in a separate “high yield” savings account, or a money market account. Remember – this money isn’t there to earn you interest but rather as an insurance policy!


Compound Interest is a powerful thing! Compound interest is your friend so yes, the sooner you get saving, the better! The reason that I recommend debt payoff and OMG fund savings in advance of retirement investing is that focus is an even more powerful thing. Focusing all of your dollars on paying off your debt completely and funding that OMG fund for emergencies will do two things: 1) You’ll see more traction sooner by paying off debt and building that fund without watering down your efforts by also funding retirement and 2) You’ll be motivated to get back in the retirement game, which adds fuel to the fire of your debt progress! 

What is Compound Interest? I’m so glad you asked!

Compound interest is that once you have an investment that is generating interest, your interest earned starts earning interest. This is really where the biggest bang from your buck comes from retirement savings. It’s not the first month or even the first year, it’s saving over time, having that savings grow from interest off investments, and leaving it alone so the interest can earn interest. There’s no such thing as a money tree here on earth but compound interest is the next best thing!


Now you’re ready to start investing – you’ve paid off all debt except your mortgage and you are flush with a 3-6 month of expenses funded OMG fund. At this point I recommend that you save 15% of your gross income. Each and every month. 

The best way to build wealth by saving for retirement is not what mutual funds you invest in or even what percentage of your income that you save… the biggest predictor of wealth and having enough money in retirement is consistently saving. It’s starting your retirement savings consistently funding your retirement month after month. Once you’ve paid your debts off and buffered for emergency, start investing 15% of your gross income for retirement. Make sure it’s in the market in mutual funds and. Keep. saving.

The best way to make this happen is to set it and forget it. Set your contribution amount to 15% so that your employer withholds that money and it goes directly into your 401k or 403b before your paycheck even comes home. This makes the contribution pre-tax and the amount of money that you are contributing is a tax deduction as well. Automatically each time you get paid, your employer withholds that percentage from every paycheck until you reach the federal limits. Don’t worry, once you hit the limit their systems will automatically stop the deduction and you will see that money start coming home instead. 

Take advantage of things like your employer match. Many companies match 401k or 403b funding the first X% which is, essentially, doubling your money once you contribute. 

At the time of this podcast recording the federal limits for funding 401K and 403B is $19,500 for those under the age of 50. If you are over 50, you are eligible for a catch-up contribution of an additional $6,500 for a total of $26,000 a year. If your income is such that $19,500 doesn’t meet that 15% mark – first of all, congratulations for killing it in that area! Keep up the good work! Second of all, you can save outside of your companies provided retirement funds in a few ways.

There is such a thing as a “back door ROTH” which means that you can fun $6,000 a year into a regular IRA account and then roll it into a ROTH. The money that you use to fund this is after taxes, which means you realized the income, paid taxes from your paycheck and “brought that money home.” You fund a normal IRA, which stands for Individual Retirement Account – an account that is separate from any employer – with after tax dollars and roll it to be given the designation ROTH. ROTH means that the money then grows tax-free or tax-sheltered in the IRA and that, when you are of retirement age and you start to withdraw that money, you don’t pay taxes on the growth. Please note that I am not an accountant nor do I ever wish to become one and you should consult a tax and investment professional to walk you through this process and make sure you are paying appropriate taxes. 

Outside of 401k and 403b at your employer, if you are self-employed you can do things such as set up a Simple 401k plan for your company or fund a SEP IRA for Self-Employed Individuals. These can also be leveraged if you are, say, a consultant being paid on a 1099 instead of an employee on a W2. See your account for details on setting up a Simple 401k or contributing to a SEP IRA if you are self-employed or working as a consultant on a 1099.

OK – now the best way to make sure that you are consistently saving for retirement is to literally set it and forget it. Set your contributions at work through HR or your HR system at 15% + of your gross income and you will start funding that 401k automatically every single month. This is great because the funding of the 401k happens before that check even hits your checking account – this makes it even easier to not spend it at Nordstrom Rack because you don’t get your hands on that money any way. 


It’s important to understand that you are in it for the long haul. For most of our listeners retirement will be years or decades in the future. It’s important that you understand that the market will go up over time. 

And yes, the market will go down, but historically it’s gone up in every 10-year period since the stock market has existed. You aren’t saving for vacation next month or even next year, you are saving for years down the road. You have to ride the  market up, down, and ultimately up. Don’t be worried if you hear that the market has dipped, it will recover!

You should be aware, but not obsessed with what the money you are using to fund your 401k is invested in. I recommend meeting with either your personal financial advisor or the advisor of the retirement administrator to get some advice on where to invest this money. 

I will do an entirely different episode on choosing the best advisor for you, but the bottom line is that it should be someone who is willing to sit down and explain things to you. Someone who has your best interests at heart and doesn’t make you feel like you are being sold to or talked down to. It’s OK for them to make a commission, in fact I prefer it because then when I make money, they make money, and that’s what I call a win-win!

The goal is for your hard-earned money that you are investing in retirement to be growing, earning interest and for that money to grow to be exponentially more money when you get to retirement age than when you funded the account. This happens when you start as early as you can, once that prep work is done, fund retirement consistently, and make sure that you are investing wisely. 

Investing wisely sounds like choosing mutual funds that have a long-track record of performing at or above the market and then leaving it alone. Things to consider when choosing mutual funds – now this is VERY high level and again, I recommend that you make these decisions in conjunction with your financial advisor. 

  • The duration that the fund has been open.
  • How long the fund manager has been managing the fund. 
  • What the fund is invested in – what types of companies the fund is invested in – this is designated by company size and location in the world – like international, global, mid cap and small cap. International are foreign companies if you are in the US. Global is a mix of US and international companies. Mid cap is mid-sized companies and small cap is small sized companies. 

Aim to go with funds that have a long-history of the same fund manager, or a fund manager that has a great track record at different funds. MorningStar has a great system for searching, comparing and researching mutual funds with lots of details about the fund manager and the lifespan and returns of the mutual funds.  


What is a mutual fund anyway?
Oh my goodness I’m so glad you asked that!

A mutual fund is kind of like purchasing stocks with all of your friends. Let me explain. A mutual fund is quite literally mutually funded. 

I put in money, you put in money, your Mom and your Aunt Peggie and hundreds of other people put all of our money in a big pile – and then we mutually fund the purchase of somewhere between 40-200 stocks. The mutual fund is managed by a fund manager – someone with years of experience and a great track record at choosing which companies to buy or sell.

Mutual funds are, in and of themselves, a more diversified investment than purchasing stocks in single companies.

You want to buy and hold the mutual funds that you invest in. You don’t want to be jumping in and out, changing funds like you change your underwear, and you definitely don’t want to be withdrawing money early from your retirement. 


Things to avoid if you want to have a great nest egg when you are ready to do it: Withdrawing funds from your retirement – sometimes called a 401k loan. This last one – withdrawing early – should be saved only for true emergencies like avoiding bankruptcy or foreclosure – as it’s associated with a big tax bill and you are unplugging the biggest investment you have working in your favor for retirement! 

You have to pay it back and, although it’s often made to seem like it’s “interest free” because you are borrowing your own money – it’s costing you each month that you are out of the market – both the interest you would be earning and the future earnings on the interest you are missing out on! It’s NOT interest free and there is a huge opportunity cost associated with unplugging your retirement. 


Keep it simple. Choose funds that you are confident in. Have an investor that you LIKE and that you TRUST and that is in the business of teaching you things, not just selling you things. Get your financial house in order – pay off debt, save for emergencies – so that you can save for retirement and mean in! Start investing 15% and do that every month… forever! 

I'm Tracy Bingaman

It's so nice to meet you... I’m a PA Mom life coach, self-care promoter, curly haired achiever, mom and dog mom, and a margarita drinking badass.

I burned out working as a PA... BIG TIME. I quit my job, doubled my hourly income earned, work half as much and learned to build a life around the things that I value instead of a schedule set by someone else and now I get to share all that I've learned with you. 

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Now I teach PAs to do the same.

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