(MONEY Magazine) -- Question: I'm facing a layoff this year. What's the best way for a freelancer to save for retirement? -- Danica, Los Angeles
Answer: Before you sweat retirement, make sure you have money tucked away to cover living expenses and health insurance for at least a year, says San Francisco financial adviser Douglas Rice. Then choose among the tax-advantaged options.
For most freelancers, a SEP-IRA is the winner. You can open one at just about any bank or fund company, and you can contribute up to 20% of your annual income (a max of $49,000).
You have until April 2012 to put money in for 2011, so you can increase your contribution if you wind up earning more than you'd expected.
And if you have a banner year, you can supplement the SEP with a traditional IRA, says New York City financial adviser Erika Safran, which would let you sock away another $5,000.
Think you can stash more than 20% of your income?
With a Solo 401(k), you can contribute $16,500, plus 20% of any additional income, up to $49,000 a year. The downside: more administrative hassles.
Finally, if you don't expect to earn much freelancing but think you can save most of it -- say, you wind up finding another job soon but still want to moonlight now and then -- go with a Simple IRA. You can put away up to 100% of your income, but no more than $11,500 a year. 
| Overnight Avg Rate | Latest | Change | Last Week |
|---|---|---|---|
| 30 yr fixed | 3.80% | 3.88% | |
| 15 yr fixed | 3.20% | 3.23% | |
| 5/1 ARM | 3.84% | 3.88% | |
| 30 yr refi | 3.82% | 3.93% | |
| 15 yr refi | 3.20% | 3.23% |
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