Do your friends and family express delight when they taste the results of what you ‘cook-up’ in the kitchen? How about those ‘snazzy’ scarves, sweaters and mittens which   your relatives and friends seem  to appreciate getting in their holiday gift bags? If they like them so much, others will too, which presents a money making opportunity for you.  Making money from what you enjoy is a fun way to fund your retirement nest egg, as suggested by attorneys for elder planning.

How: Your Hobby Can Finance Your Retirement Nest Egg

If you possess a money making talent, why not use it to make money? And while you are at it, use some of that money to fund a retirement account. As the saying goes, “every little bit adds up”. Let’s look at Sally and John:

  • Sally (name changed to protect the retirement savvy), has a passion for knitting baby booties, sweaters and hats.  She started out by selling to friends and  family and now she makes an average of $20,000 per year from her expanding market base.  Sally plans to save at least $5,000 of that per year in her IRA, for 20-years, at the end of which she plans to retire. By then, Sally will have saved about $155,000, assuming a conservative 4% rate of return. This will be more when her profits and her savings increase.
  • John flips houses, and he is also a freelance web designer. These are just two of the things that John loves to do  and he earns about $200,000 per year from these and other ventures.  He sets up a Solo-K/Individual-K plan which he funds from his business to the tune of $49,000 per year. If John continues to save  that amount per year, he would amass  in excess of $1.5 million after 20-years, again assuming a rate of only 4%.

The amounts which are saved in an IRA , 401(k) or other retirement  savings may be eligible for a tax-deduction, which can offset the expenses of funding the account, and additionally the earnings grow on a tax-deferred basis ( tax-free if your account is a Roth)


  • With IRAs, you can save up to $5,000 per year, or $6,000 if you are at least age 50 by the end of the year. Learn more here by clicking on the link:
  • According to goldsilver, with 401(k)s, you can save up to $49,000 per year, plus an additional $5,500 if you are at least age 50 by the end of the year, depending on your total earnings for the year

Why: You Are On Your Own

This is not your parent’s retirement. They had social security and very likely workplace pension plans which served to finance their retirement years.  But with social security set to be depleted by 2040 (according to the trustees), and pension plans performing disappearing acts, you are on your own when it comes to financing your retirement.  This means that the steps you choose to take now with regards to funding your retirement nest egg will determine the quality of your retirement, financially speaking.

Who: Knowledgeable Professionals

You may need the help of professionals to make sure your retirement plan is properly set up and managed effectively. Simple mistakes can result in losses which could be detrimental to your retirement nest egg.  Your team of experts should include – at a minimum- your financial advisor who can help you to set up and fund your account, as well as manage your investments; your tax professional to help ensure that you receive any available tax-write offs for your retirement savings; and, your attorney, who can help to chose the type of business structure most suitable for you. You may also start with your estate planning, check out helpful sites like for guidance.

However, if you’re a blogger who is a paying a tax, you may look at this article on how to calculate taxes on bloggers because even as a hobby blogger that makes a minimal and sporadic income, it’s exceptionally important that you register as self-employed and start declaring your income as soon as you’ve got one, however small it may be.

Where: Any Eligible Financial Institution

Your retirement account can be maintained with any eligible financial institution, including banks, mutual fund companies and eligible brokerage firms. Talk to your financial advisor for help with choosing the financial institution that is right for you.

When: By Year-End

If you plan to set up a 401(k) for your business and would like to add money to it for this year, you have until the end of the year to do so. Some financial institutions have instituted earlier deadlines, as a means of ensuring  that they meet the IRS’ December 31 deadline. This means you may need to contact your financial advisor no later than today.  IRAs can be established as late as your tax filing due date, not including any tax filing extensions.

What:  Conclusion

Diligently adding to your retirement nest egg today ( or not), could mean the difference between a bland retirement during which time you exist on the basics or even less,  or one that you can spice with that extra retirement savings. Take the bold step today, turn your hobby into a money making venture and sock away some moolah for retirement.

Denise Appleby

Retirement Dictionary

Appleby Retirement Consulting

Telephone: 973-313-9877
Fax: 888-524-3120
Grayson, GA 30017
DAppleby (2 Posts)

Expert on IRAs, 401(ks) and other retirement accounts. Bold and Spicy writer of retirement and related topics. For more, please see link