In order to produce the podcast and keep content up free for you, I work with partners so this post may contain affiliate links. Please read my full disclosure for more info.

Retirement can seem intimidating to some couples as the choices seem vast.

Today I want to review some retirement tools you can use to build your portfolio and I'll interview Doug Nord, a successful retiree, on how he create a plan that worked for him.

This post is designed to get you off just planning for your retirement and into building the retirement plan you two have always wanted.

Retirement Tools to Build Your Portfolio

One of the biggest advantage of getting your retirement started is the amount of choices you have.


There are great tax advantaged accounts like 401(k)s and IRAs that give you a chance to stash and grow your money. However, which tools are right for you?

Like much in finances, it depends on your goals and investment styles.

While I can't give you absolute rules for retirement, I can offer information that has helped others make the transition into retirement.

MoneyTips recently ran a survey that examined how successful retirees reach their goals.

One of the questions looked into the retirement tools they used and here's what they found:

  • Traditional IRA
  • 401(k)
  • Defined Benefit Plan
  • Roth IRA
  • Tax Sheltered Annuities
  • Rental Properties
  • 403(b)
  • Other
  • Health Savings Account

As you may have noticed, there are quite a bit of different tools to use when saving and investing for retirement.

If you're not familiar with the tools themselves, I've included links to more detailed articles on them.

Where Should I Start for Retirement?

Learn how the two of you can set up your contributions so you can retire early!

Assuming that you’ve gotten out of high interest debt, now's the time to contribute and grow your money.

As a general rule of thumb, you want to start with the account that will give you the biggest bang for your money.

As time passes that advantage snowballs in your favor, another reason for you to start now rather than later.

I'm going to use as an example someone who  works for a company that offers a 401(k) and whose income also allows them to have a Roth IRA.

Both accounts can be incredibly powerful when used correctly, but with your contributions limited for now, you want to optimize them. Which do you start off with?

Here's what I would do and why:

  • 401(k) up to the employer’s match
  • Roth IRA up to the year contribution limit
  • Rest into 401(k)

That 401(k) offers you some free money that over time will help you get to your retirement goal quicker.

Once you have that match, though, the freedom Roth IRAs and the tax free withdrawals when you retire can offer you is something you can use to your long term benefit.

If your employer doesn't offer a match, then you may want to contribute your money to the Roth IRA's maximum and then any additional to your 401(k).

If you have a unique situation or you want to bounce ideas with a financial professional, I'd suggest finding a fee-only, independent financial advisor through an organization such as The National Association of Personal Financial Advisors (NAPFA) to help you come up with a practical and affordable  game-plan.

Who Should I Invest With?

The good news is that there are plenty of options when it comes to opening an IRA.

Banks, brokerages, and credit unions typically offer them as a part of their services.

Some charge a flat fee for the year, some take a fee for each transaction made, others can take a percentage, and some do all of this.

Our personal choices for our Roth IRAs have been Vanguard and Betterment. Both offer low cost index funds that allows us to passive invest our money and keep expenses much lower than with other providers.

It's an investment strategy that we have looked into and fit our financial philosophy.

Vanguard is known for having great customer service and being a valuable resource when it comes to investing.

I currently use them for my Roth IRA and I've been quite happy. Being with Vanguard means I can buy their ETFs free. Since I already buy these it would save me some money.

If you’re interested, you can sign up for a new account at Vanguard.

Betterment fits my husband's investment style -his contributions are automatically invested and re-allocated to make sure he stays on target to the growth plan selected.

If you’re interested, you can sign up for a new account at Betterment here.

I definitely like Vanguard and Betterment as places to invest your IRA contributions. They are both some great no hassle, low cost options that make it simple to invest in your future.

Managing All Your Accounts Easily

Now that you have a plan and you've sign-up for your contributions, your job is making sure your investments are working for you.

If you're looking for a way to track all of your bank accounts and watch your retirement portfolios, Personal Capital offers a free portfolio check-up.

To me, Personal Capital is like Mint (easy to set up and use), but on steroids (more features).  I believe Mint is more suited for general purposes and Personal Capital is focused on investments and growing your portfolio.

Personal Capital does have cash flow report and there are some wonderfully useful tools that can help you optimize your investments such as a 401(k) fee analyzer and asset allocation examiner.


How to Start Your Retirement and Finish Early

I'm also excited to share how couples can succeed together with their financial goals.

Today, I'm proud to share Doug Nordman's story about retiring early, what tools did they use to invest, and what lessons has he learned and wants to pass on to his daughter and others?

Doug  was kind enough to talk to me this week about how he successfully retired at 41 after serving 20 years in the U.S. Navy.

Now he's helping others plan for early retirement through his blog The Military Guide and book The Military Guide To Financial Independence & Early Retirement (All royalties are donated to military charities including Wounded Warrior).

Doug, when did you start investing for retirement? What retirement accounts did you use and why?

Doug is enjoying his retirement
Doug is enjoying his retirement

When I finished college and started my Navy service, I had very little free time.  I was frugal and kept a tight budget, but I had no idea what to do with the money.

I eventually stumbled across a nice young broker from Paine Webber (whose tag line in 1982 was “Thank You, Paine Webber”) and ended up in a nice bond fund.

Interest rates had just hit a peak so that turned out to be a sensible recommendation, but I had no idea what I was doing and I was paying hefty fees.  This went on for four years until I finished my sea duty, married, and started shore duty.

(Note: The Thrift Savings Plan had been just a recent development, so when Doug retired from the service he only had accrued about 5 months of savings. His wife, who also served, accumulated about 6 years. )

When my spouse and I consolidated our finances in 1986, she had equity mutual funds.  (She'd learned much more about investing from her parents than I had from mine.)

My Dad suggested a copy of Business Week's annual mutual funds guide and said that he'd been happy with Fidelity.

After a few weeks of phone calls and mailed forms, we were finally with Fidelity and 20th Century (they later became American Century).

Back then you paid a 2% sales charge to buy Fidelity mutual funds– and if it was a popular fund then you paid 3%.  But they had great customer service, they were an easy answer, and I had other interests.

Every two weeks I'd write out a few checks and deposit slips, stamp the envelopes, and drop them in the mail.

I'm drawing a military pension now, which includes an annual cost of living adjustment.

We're still frugal and that pension covers half of our expenses.  We acquired a rental property along the way, and that finally has cash flow.

Because those two assets cover the majority of our spending, the rest of our savings is aggressively invested in equities– over 90%.  (The rest is in a money market and CDs to cover two years of spending for bear markets.)

We have exchange-traded funds in domestic dividend stocks, international dividend stocks, and small-cap value stocks.

We also have a portion of our portfolio in Berkshire Hathaway “B” shares.  There are no more sales charges, of course, and our overall portfolio expense ratio is about 0.23%.

What were some of your biggest challenges? How did you overcome them?

My biggest obstacle back then was ignorance– I'd never been raised with investing skills and I didn't really take the time to learn them until the 1990s.

If I was starting over today then I'd read about investing from books like the Boglehead Guides or Rick Ferri or William Bernstein.

As parents, what knowledge have you passed to your daughter?

Our daughter just finished college in May and started her own Navy career.  She has no free time either but as you can imagine, she's had quite a bit of investing education during her life.  She's turned out to be at least as frugal as her parents, and she keeps a budget too.  However she started out with the military's Thrift Savings Plan, which has expenses as low as 0.02% (lower than Vanguard).

She maximizes her contributions to that and then maximizes her contributions to her Roth IRA.

That's invested in Fidelity's Spartan index funds– the U.S. extended market index, an international fund, and a dividend fund.
She's investing even more of her money in taxable accounts with Fidelity in the same funds.  She's set up all of this online and it's automatically deducted from her pay (and her checking account).

She knows that if she wants to be financially independent in her 40s then she needs to save at least 40% of her gross pay for 15-20 years.  She's set up her budget, chosen her asset allocation in passive index funds, and put all of the decisions in autopilot.

She knows that every year she'll try to maximize her TSP and IRA contributions and then do the rest of her savings in taxable accounts.  Her biggest decisions will be remembering to boost her contributions whenever she gets a pay raise, and to occasionally rebalance.

(Doug and I wholeheartedly agree that automating your contributions makes things so much easier and can help you stay on track for your retirement.)

When she becomes part of a couple, she already understands the basic investing concepts.  If she wants more then I'd point her toward the books & websites.  We'd spend more of our time talking about investor behavioral psychology, too.  But I think most of our time will be spent showing her (them) how to sort through all the information to arrive at a few choices, make a decision, and automate it.

Thoughts on Retiring as a Couple

I hope Doug's story and tips help you two to create a retirement plan that you want. As Doug showed, you don't have to have a perfect building to finish early. You just have to get started and be willing to learn as you go.

I'd love to hear about your progress so far, whether you're new or a long time reader. How far along are the two of you with retirement?

About Elle Martinez

Elle Martinez helps families at Couple Money achieve financial freedom by sharing tips for reducing debt, increase income, and building net worth. Learn how to live on one income and have fun with the second..