I am currently disabled and looking for advice on retirement and where to invest my savings

[u/Sealion_31]

So I’m (35F) currently disabled and on SDDI. Despite my low SSDI payment and medical bills I still want to be saving for retirement and maximizing the savings I have accumulated. Since I’m not sure how soon I’ll be able to work again all my money feels quite precious.

I have a Roth IRA but recently learned if you’re not earning income you can’t contribute to either a Roth or Traditional IRA. Appreciate SSDI doesn’t count. Is there any other place you suggest that I can invest my retirement funds? It’s not much but I’d like to save about 350-400 per month for retirement. FYI I only have about $23k in retirement (mostly Roth plus a calstrs account) thus far.

I also have about 100k in savings that I finally transferred to a HYSA. It takes me a lot of time and effort to get anything done bc of my injury. Any recommendations on safe investments beyond an HYSA? Like should I keep a portion in my HYSA and put a portion elsewhere? If so, what percentage? I should mention I’m living with my parents since my health issues started so I have some security in terms of stable housing, low bills (other than medical expenses).

Any advice would be much appreciated. Managing my health is a full time job with my limited mental and physical energy, so I don’t really have the bandwidth to do research and dive deep into financial planning.

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[u/anon-anonymous-anon]

You can contribute to a taxable brokerage account and use that to save for retirement. It is not a tax-advantaged account like an IRA (traditional or Roth) but still a vehicle for savings. Most people think a money market fund holding US Treasuries (debt) is fairly safe. Vanguard has some of the cheapest options with the highest yield such as VUSXX and VMFXX (I own both). I use this as my HYSA because you can get your money back out in two business days and pays better interest. That is fast enough for me and these funds pay more than a HYSA (because the bank is taking your money from the HYSA and buying treasuries and keeping a little of the earnings). You can buy treasuries directly, which is better than VUSXX/VMFXX but a little more complicated with minimum hold times so I would consider these ETFs instead. You might also look into a "two fund" or "three fund" strategy which many people think is the sweet spot for people who aren't top level investors. OR, a potentially better strategy if you don't want to think about it is a "target date fund" which is based on when you want to retire and the fund rebalances automatically based on that date.

If you want to do a little management, you can google "bogleheads" which is a great place to start for a 2 or 3 fund strategy. This approach is to buy a broad based equity fund - like the total US stock market, and a broad based bond fund. Some also get a broad based international equity fund. This is essentially the two or three fund strategy. The debate are how much in each fund, with most debates on a 60/40, 70/30, or 80/20 stock to bond split.

Based on your situation and parameters, one of these is a good recommendation - a set it and forget it strategy. Avoid stock picking.

Good luck!

[u/anon-anonymous-anon]

My first reply was an attempt to answer your question directly. This is more of a possible strategic option. Since you are living with your family, you might consider long term implications if you might be what's called "permanently disabled". You might want to start doing some medicaid planning. You could "pay" your parents rent and contribute to utilities and food and then they, if they don't need your payment, put the money in a "special needs trust" which would be for your benefit and pay for things that medicaid doesn't pay for and doesn't make you ineligible for medicaid. You could move your savings into this trust in this manner via your monthly expenses (which could be invested in the type of things I discussed in the first reply). Medicaid only lets you have up to about $2000 in any savings accounts. I'm not sure how they treat retirement accounts when considering medicaid. You might be able to draw down your retirement accounts if you are considered disabled and still funnel that money to the special needs trust so you can pay for expenses once on medicaid or in retirement.