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Ask the Hammer: What Should Independent Contractors Do About Taxes and Retirement Planning?

Jeffrey Levine, chief planning officer at Buckingham Wealth Partners, discusses in this Retirement Daily video what a parent's adult child should do about taxes, retirement planning, and becoming an independent contractor.

My son, age 29, has been working in the oil fields since he graduated from college seven years ago. He had a plan when he started: Work in a lot of different areas to get broad experience so that he could be the on-site engineer managing the job, either as a "company man" or as a consultant.

He just landed his first job as a consultant, and while he's thrilled about all the money he expects to make, he's now an independent contractor - no employer-provided health insurance, 401(k), 1099 not W-2, etc. The consultant firm that hired him will provide his professional insurance (he pays them for it.)

He's not currently married (that may change!), no kids, no house (rents), no student loans to pay off. He'll pay for his own travel to and living expenses at the job sites.

I'm thinking he needs to be thinking about specific things regarding taxes, retirement planning, setting up as an independent contractor. What should he be doing/preparing for, and in what order?

That's the question Jeffrey Levine, chief planning officer of Buckingham Wealth Partners, answered in this episode of Ask the Hammer.

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