Have you recently received a pension buyout offer? If so, you need to decide if you should take the buyout, which could provide you with a potentially large lump sum, or continue accepting your regular pension payments for the rest of your life. It’s a big decision.
Labor Day is coming up. It is a day that honors hard-working men and women across the United States. As an investor, you’d like to think that all your investments are working hard, too — including the ones that are producing income.
Have you recently received a pension buyout offer? If so, you need to decide if you should take the buyout, which could provide you with a potentially large lump sum, or continue accepting your regular pension payments for the rest of your life.
To achieve investment success, you don’t have to start out with a huge sum or “get lucky” by picking “hot” stocks. In fact, very few people actually travel those two routes. But in working toward your investment goals, you need to be persistent — and one of the best ways to demonstrate that persistence is to invest automatically. How do you become an “automatic” investor? You simply need to have your bank automatically move money each month from a checking or savings account into the investments of your choice.
If you are relatively young, and you have been investing only a few years, you possess an asset that is invaluable and cannot be replaced: time. And the more time you spend contributing to tax-advantaged investments, the better off you may be. Time is your ally for two reasons. First, the more time you give to your growth-oriented investments, the greater their growth potential. Second, the effects of market volatility have tended to decrease over time, though as you no doubt have heard, past performance is not a guarantee of future results.
If you are contributing the maximum amount to your 401(k) or other employer-sponsored retirement plan each year, that’s good. And if you’re also maxing out on your Individual Retirement Account (IRA) annually, that’s even better. But what then? If you’re already fully funding your 401(k) and IRA, can you put away even more for retirement? Should you? The answer to this last question is almost certainly “yes” — because you could spend a long time in retirement.
As an investor, what are your goals? You can probably think of quite a few — but over the course of your lifetime, your objectives typically will fall into five categories. And once you’re familiar with these areas, you can start thinking of what they’ll mean to you in terms of your financial and investment strategies. So, let’s take a look at each of these areas and see what they might entail for you. Preparing for retirement — With advances in health care and a greater awareness of healthy living practices, many of us can expect to live two or three decades in an active retirement. To pay for all those years, you’ll need to save and invest early and often.
It’s important to understand which investments to own, and when to buy them. But you should also know when it’s time to sell an investment and why. Unfortunately, many people sell investments for the wrong reasons. Some people want the money to purchase so-called “hot” investments, even if these new investments aren’t appropriate for their needs. Others own investments that have lost value, and fearing further losses, they decide to sell, thereby violating the oldest rule of investing — “Buy low and sell high.” These types of behaviors can lead to at least two major problems.
Some people buy investments here and there, now and then. Others open an Individual Retirement Account (IRA), put some money in it, and then forget about it. But this type of haphazard investment behavior can lead to haphazard results. On the other hand, you’ve got five good reasons for creating and following a comprehensive, long-term investment strategy. Reason No. 1: You want to enjoy a comfortable retirement lifestyle. For most people, building resources for retirement is the most powerful reason to invest. As a key part of your investment strategy, you’ll want to consider investments that have growth potential. The proportion of your portfolio devoted to these growth investments should be based on your individual risk tolerance and time horizon.
from the candidates. As a citizen, you may or may not enjoy this “political theater,” but as an investor, you might be concerned over all the talk about taxes, Social Security, Medicare and other financial topics. Will you need to adjust your savings and investment strategies? If so, how? Before you think about adjusting your investments in anticipation of any actions coming from Washington, keep a couple of facts in mind.