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.
When you invest in stocks, you want their price to go up. But of course, you can’t control the rise and fall of stock prices. However, there is a key element of investing that you can control — the number of shares you own. And in the long run, share ownership may be more important than rising stock prices in determining your long-term investment success. Of course, you might think that the advice of “buy more shares” is easier said than done. After all, not everyone can easily find a lot of extra money to invest. But you don’t need access to vast wealth to increase your share ownership — you just need to consistently reinvest your stock dividends. Just how important are reinvested dividends to wealth accumulation, as compared to capital gains (the increase in stock prices)? Over the 135-year period from 1871 through 2003, owning stocks and reinvesting the dividends produced 97 percent of all stock market returns, with only 3 percent coming from capital gains, according to a major study done by Dr. Jeremy Siegel, one of the world’s leading researchers on stock market performance.
Several years ago, the book “Men Are From Mars, Women Are From Venus” was quite popular. As the title suggests, the book argues that men and women are vastly different from each other, particularly in their emotional needs and in the way they communicate. While not everyone agrees with the notion that men and women might as well be from different planets, most of us would concur that the two genders frequently behave differently — and this divergence in behavior may also show up in the way that we invest. In fact, various studies and anecdotal evidence suggests these differences in the way that men and women invest:
As an investor, you may find that bonds can be a valuable part of your holdings. But there’s more than one way to own bonds, so you’ll want to be familiar with the various investment vehicles available — because the more you know, the better the choices you’ll be able to make. So, let’s look at three popular ways of owning bonds: Individual bonds — When you buy an individual bond, you will receive predictable interest payments. And when your bond matures, you’ll get the original principal back, unless the issuer defaults, which is not common in cases of “investment grade” bonds.
To enjoy a comfortable retirement, you’ll need to have adequate financial resources in place. And that means you must not only plan for the expected — but for the unexpected as well. In planning for the expected aspects of your retirement, consider these factors: Your vision of your retirement — What do you want to do during your retirement years? Spend more time with your family? Volunteer? Open your own business? Your expectations of your retirement lifestyle will dictate, to a large extent, your savings and investment strategies.
You may be unaware of it, but September is Life Insurance Awareness Month. And while a whole month may seem like a long time to focus on life insurance, it’s actually a good opportunity to realize the important role that life insurance plays. Unfortunately, many people don’t have sufficient insurance.
Many people depend on certificates of deposit (CDs) to provide extra income. Yet CD rates have been fairly low for a while. In recent months, in fact, one-year CDs were paying about 0.5 percent, two-year CDs topped out at around 1 percent, and five-year CDs paid in the 2-percent to 2.3-percent range.
If you’re a woman who owns a business, you’ve got plenty of company. In fact, women own more than 10 million U.S. companies, and women-owned businesses account for about 40 percent of all privately held firms in the U.S., according to the Center for Women’s Business Research.
When you invest in stocks, you want their price to go up, but you can’t control the rise and fall of stock prices. However, there is a key element of investing that you can control — the number of shares you own. And in the long run, share ownership may be more important than rising stock prices in determining your long-term investment success.
If you’re a baseball fan, you’re no doubt aware that the MLB All-Star Game was July 12. But while you probably appreciated the grace and skill of the players, you may not realize just how much a baseball team can teach you about other aspects of life — such as investing.
Some investors find the thought of investing in the stocks of companies intimidating. After all, how do you possibly decide which companies, out of literally thousands, to choose? A good place to start is by taking a closer look at the products and services you use in your daily routine. Consider a day in the life of an average American.
Many stocks were pummeled by the long and severe market downturn.
As an investor, you’re always aware of the potential effects of market volatility on your portfolio. But you also need to pay attention to another factor that could impact your investments’ return — inflation.
No matter where you live, the chances are good that a state or local government near you may be having some difficulty in balancing its budget.
April 18 was the deadline for filing your individual tax return.
If you’re purchasing a new home or refinancing your existing one, you’ve got some mortgage-related decisions to consider.
Now that spring is here, you may find it easier to get outside to run, bike or take part in other physical pursuits that you enjoy.
During your lifetime, you make a lot of moves to provide financial security to your loved ones.
Unless you’ve been cut off from every source of media, not to mention all human contact, you’re aware that the Super Bowl is this weekend.
In life, you can’t avoid all risks — and you shouldn’t try, because endeavors that carry risk also bring the prospect of reward. And it’s certainly the same in the investment world.
If you’re like many homeowners in this country, you probably saw your house appreciate in value quite a bit over the past few years.
You may not see it posted on your calendar, but next week is National Save for Retirement Week.
At some time or another, you’ve probably thought about what you’d like to do during your retirement years. But when will those years begin?
National Grandparents Day was Sept. 12. If you’re a grandparent, that day was meant to honor you — but you can also celebrate by investing in your grandchildren’s future.