Five Things You Need To Know When Deciding How To Invest For Retirement

Successful investors are good at finding opportunities. Successful investors buy low, sell high, and keep emotion out of their decisions. Sound easy? Like most things, it sounds easier than it is. Fortunately, you can get help (as we'll discuss in a moment.) For now, where should you invest your money? If you're an inexperienced investor, it might make sense focusing on mutual funds first - that way you can take advantage of the skills and expertise of professionals. (Of course, you can also choose to buy individual stocks - but that's a discussion for another time.)

Whether you invest your funds through a 401(k) or as a separate investment, there are tons of choices. Let's look briefly at a few of the major investment categories:

Stock mutual funds are portfolios of company stocks. When you buy a share of stock, you buy a small piece of ownership in the company. A stock mutual fund buys shares of stock in a variety of companies in the hopes of getting a great return on investment in aggregate. A stock mutual fund may own shares of stock in hundreds of different companies. The price of a share of that mutual fund is based on the value of all the stocks owned by the mutual fund. When share price increases in value, the price of the mutual fund increases. Since mutual funds tend to own hundreds of different stocks, no one stock causes the share price to increase or fall dramatically. If it helps, think about a stock mutual fund as one way to have a professional make decisions about how to invest your money.

Bond mutual funds are like stock mutual funds except they invest in corporate or government bonds. A bond is like an I Owe You. You purchase the bond and a company or government entity promises to pay you back your investment, with interest. Bond mutual funds focus on purchasing high-yielding bonds. In general, a bond mutual fund is somewhat less risky than a stock mutual fund... but not always.

Stable value accounts and money market accounts are typically made up of certificates of deposit (CDs) and  Treasury securities like Treasury Bills. Stable value accounts are very secure and offer small and steady growth. You won't get rich overnight, but your money should be fairly safe from loss.

So what types of investment are right for you? Start by determining your goals and deciding how much risk you are willing to accept.

Determining your willingness to take on risk is a key factor. Why? The answer lies in the premise of risk and return:

• If you stay conservative and invest in stable value funds, you will receive lower returns but also face a lot less risk.
• If you purchase a mix of conservative and aggressive investments, you will face more risk but hopefully receive higher returns.
• If you invest aggressively you may receive higher returns, but you will face a lot more risk. In general, the more you make the more you have to risk.

Keep in mind every investment involves some amount of risk. The longer you can stay invested (in other words, the longer until you retire), the more risk you can typically take on if your goal is to achieve higher returns.

For example, if you think you will need to start withdrawing money sooner rather than later, your willingness to take on risk should be lower, so you should probably choose investments like bond funds or stable value funds, since they tend to be less risky and provide relatively stable returns.

If you have a lot of years of investing ahead of you, say fifteen to twenty or more, then you can in all likelihood afford to take a few more risks with your money. The longer your money is invested the more time you have to recover from losses.

Then think about your general feelings about investing. Risk tends to create stress and anxiety. Stressing over how your investments are performing is not particularly fun. Think about what level of risk you are comfortable with and then make your investments with that in mind. But keep in mind that most plans let you shift your money between funds a number of times each year - in some cases as often as you want - so if you change your mind about how to invest your money you can make changes to your investment allocations. Investment decisions aren't forever.

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Preparing Early Retirement

Retirement is one of the strategies that should be more carefully prepared and audited in life, because on it depend the future of who stop working permanently. The retirement can therefore be understood as a financial reward after so many years of active service, which takes the form of a monthly income that is received based on the number of years worked and amount of taxation that were paid (tax).

Pensions are of two types, contributory and non-contributory:

• Contributory pensions are those based on the amount of money managed to accumulate the regular payment of contributions or system specifically use certain workers

• Non-contributory pensions are those who are granted a monthly amount for life, which is less common than occupational pension, but has the characteristic of being granted in cases where the amount of money accumulated was not enough and have few resources

1. Retirement depends on oneself

There is no chance to blame someone else for a lower retirement, because it depends essentially on the basis of the worker's effort could do to save money each month while in active employment status.

The money saved is invested to achieve capital growth, so that is another factor that must be evaluated to care for the future of retirement. Oversee what is done with the money that is contributed monthly while working is part of the force responsible for anyone who wants to secure their old age.

2. Choose how to save

Retirement will be the salary that you will live when you do not have tickets for formal work product, hence the need to calculate how much you want to have in the future with time, thus preventing any accidental problem for lack of diligence. When ready to invest pension savings, it is noted how the portfolio is to invest in the stock, bonds and other types of alternative financial profitability.

Accumulating money for retirement is not a mechanical act, we must make a saving strategy to associate with a type of investment or investment product as determined by the time goes by and the changing investor profile.

3. Saving Time

Saving for retirement is not just a couple of years, is part of a strategy of life should be started as soon as possible, hopefully as soon as entering working life. To focus on this subject well, think that the expectation of obtaining a fixed rate at retirement will always be maintained, therefore more time that passes in not less, should be saving more then to help reach that expectation or risk they will have to incur to make investment worthwhile effort.

4. The savings does not end with retirement

Many people mistakenly believe that when they retire, stop saving automatically, but it is not. With the increased longevity of seniors, the accumulated amounts usually do not give sufficient to fund the extended life of people reaching 75 years (if they retire at 65), it is desirable to maintain retirement of the amount provided by investing, though under a program for lower risk.

5. Good financial advice

Where the advice is appropriate and complete, you can make decisions that optimize the level of earnings of those investments to preparing for retirement early. Try to get advice for your personal bankers, or financial experts.

Happy investing:)

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Make Your Money Grow

If you are a salary earner you shouldn't depend on only your salary alone to survive. This is because things are moving at a faster pace than before, inflation is on the rise and economic depressions and recession are on the increase. Not to talk of increasing population of humans. What do we do? Do we sit down, fold our hands and cry?

No, we have to adapt to the situation we find ourselves. As the saying goes change is the only constant thing in life. Therefore we change with situation. We adapt to our world. Our forefathers had only one stream of income and they survived but not us. We need more. So we need to have multiple streams of income.

Again to really survive our times you need to save your money at least some of it. Don't spend all, keep some for the rainy day. Rich people save some of their money and spend the rest on things. On the contrary poor people spend their money and save the remainder. Most times there is no remainder. What with school fees (and other fees), power bill, water rate, rent for house, hospital bills, taking care of the extended families etc. Well in spite of all this we can still save.

After saving some of your money go further than that and invest your money. That is the way you can ensure a sustainable future for yourself and your loved ones. Investment is really the key. To ensure a secure future, I mean a really secure financial future for you and your family you need to go beyond saving some of your money. You need to invest.

Everyday, we hear, read and watch in the media about retirees dying at the venue of collection of their pensions. I'm sure you would not like that to happen to you or any one you know. I'm sure that if you have a way of forestalling such you'll grab the chance. Investment is the answer. There are many millionaires today in the world who made their millions through investment.

Examples are Warren Buffet, Wiliam Gates, Robert Allen, Robert Kiyosaki and others. Yes investing is not all about stocks. You can build businesses and use it to secure your financial future instead of depending on the government or your employer for your future finance. I'm not saying you should not work hard for your boss, or government. No, far form it, by all means work very hard. That way you get to earn more.

I'm just saying as you are working hard and earning much remember the future. I'm sure there are many beautiful things you've planned for yourself in the future. Like buying a new car, living in your own house, sending your children to the best schools either here or abroad and others. Now tell me how you will be able to do all these without money and lots of it? Investment will ensure that you get the future you want. This is possible because investing assures you of steady and reliable passive income stream.

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10 Ways To Prepare For Retirement

Planning for retirement can be a daunting task, especially  given the recent economic climate.  However, majority of the working force want to spend their last years content, secure and financially sound before thinking about retirement. With some simple steps and strategies, and by reviewing our tips to prepare for retirement, financial freedom can still be achieved.

Top 10 ways to prepare for Retirement

1. Select a target date for when your want to retire

2. Calculate how much money you need to accumulate by the time you want to retire

3. find out how to maximize your Social Security benefits

4. Take full advantage of tax-exemption plans such as term insurance, annuities

5. If your employer does not have a pension or retirement plan, ask that one be started.

6. Do not touch your savings for anything but retirement

7. Diversify your assets and be sure to include guaranteed income for life

8. Ask questions. Get help. Seek the assistance of a professional insurance/financial advisor

9. Start now, set goals

10. Do a retirement plan and monitor your progress.

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Is it Possible To Retire Young?

For some workers in the public sector, the answer might be "most definitely," you can retire young.

People who work in local and county government tend to retire at an earlier age than most other workers. Why? Well, they are our police officers, firefighters, and public administrators. And they usually have what's called a defined benefit plan, a pension set up by their employer to save money for when they retire.

So what does it mean to retire young? It means that many in public service can often afford to retire in their late 40s or 50s because they have a pension and supplemental retirement savings through their term insurance plan, and the combination, hopefully, has been fruitful. The rest of us, without the back-up of a pension, will most likely retire in our late 60s or 70s and hope Social Security is available.

If you were a public employee and you enrolled in your employer-sponsored provident/welfare plan when you first started working, and contributed regularly through payroll deductions, you would most likely have been disciplined in your savings habit and have a growing nest egg to show for it - at your "young" age.

Are you a public service employee who retired "young?" How are you spending your retirement? Is vacationing part of your retirement plans? If you're not retired yet, have you been saving in your term insurance plan to supplement your pension? If not, why not? If so, what tips can you share with us? Your first-hand experience is valuable. Tell us how you did it.

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How to Plan for Retirement

Majority of people assume that retirement planning is only meant for people who reach old age or are close to retirement. However, this is a false notion. This planning can also be done in your youth. In fact, it is advisable to begin planning for retirement at the earliest, so that you save sufficient money for your golden years.

Of course, it goes without saying that proper care should be taken when planning your retirement. It is not something that can be done in a jiffy. You have take everything into account, like long term financial plans, expenses in the future, healthcare, accommodation, taxes and so on. Basically retirement planning involves taking into consideration everything you will need when you grow old and are no longer working.

So, to help you out, here are some steps that will show you how to plan for retirement.

The first thing that you have to do is gauge your present financial situation. This means weighing your monthly expenses, income and savings. In addition, try and figure out how much money you will need to lead a good standard of life after retiring. This will allow you see how much you need to save in order to have that standard of living.

Then jot down all things you would like to have, experience and own during your retirement. This would include things like vacations, finances, assets, home, hobbies etc. This will help you plan out your retirement so that you can own as well as experience these things without feeling the financial crunch. Do not forget to take into account health care as well as emergency situations.

Health is important in retirement. While you may have all the money to take care of your health needs, you still need to take steps to ensure you have a healthy retirement. This means making lifestyle changes and quitting smoking and drinking while concentrating on eating healthy and exercising regularly.

In case you are an employee of an organization, find out from the HR department all the retirement policies and plans that the organization has. Find out which are the best plans and policies and invest in them. You can also invest in mutual funds and term insurance

At the same time, get rid of all your financial liabilities. These could include student loans, car loans, and mortgages. Your plan should be to save as much money as possible for your retirement. Also, try to find different sources of fixed income so that your retirement income is supplement. You can do this by renting out your second home or even investing in a commercial property.

With these tips, you should be able to plan your retirement without any hiccups.

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Source of Income When You Retire

A retirement pension planning always assures you a good and luxurious life, even though you are not earning. With retirement and employee pension plans you do not retire, rather you get a leisure period to enjoy the life to the last moment! You must go through this stuff to understand why people are more interested in early planning for retirement.

First of all you get independence. You don't have to be dependent on others. In-fact in our society, we often see that a retired person is assumed a luggage by other family members and retired persons are often denied their basic requirement for living a luxurious life.Second point may be summed up as "the sky-rocketing prices often tend to dump even the well salaried person".

Due to inflation and frequent changes in economic policies every working and retired person experience trouble in living a smooth life.

Current Market analysis and survey report reveals that only 30% of earning community have invested for a retirement plan. For the remaining 70% people life may become really tough without retirement investment planning.

So you might have got a horrible portrait of people who have not invested for secure future.While insuring a retirement plan you must look for various factors too. These factors may be summed as the total return on saving, Whether disability pension plan is offered or not and whether there are defined investment plans or not.

Happy Retirement investment!

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How Much Money Do I Really Need to Retire?

No matter how old you are, retirement planning probably seems like something that you know you should be doing but just can't wrap your head around at this point. However, the question of how much money you will need to retire is certainly one that has occurred to you, even if you have never tried to figure out the answer.

Here is a quick way to estimate what you will need to save in order to retire comfortably: 

Calculate your current living expenses. You will need approximately 65 to 70% of that amount each year during retirement. This could change depending on the lifestyle you hope to have - will you travel extensively? Do you have health problems that may worsen, resulting in rising medical costs? Consider these in your estimation. 

Do you intend to continue working? Even a part-time job as a senior can help you defer some of the costs of retirement. 

Look at your financial picture to determine how much money will come from guaranteed sources such as social security or pensions. As many people have experienced in the current economic situation, "guaranteed" is a relative term. However, this is useful for planning purposes. 

Account for inflation. 

Estimate how long you will be retired. This may require consulting with your physician or a life expectancy calculator. Although it isn't a very fun thing to think about, a realistic estimate will ensure that you have funds to take care of yourself as you age. 

Make a plan. Based on your age and these calculations, you can establish savings targets for each month or year. Keep track of your progress and adjust the plan as necessary. 

Rule of Fifteen. Sound like too much to handle? Not to worry. If you are a young investor, the general rule of thumb is that you should be aiming to save 15% of your income each year. That amount does not have to come exclusively from your post-tax dollars, but can be a combination of your contributions to a 401(k) along with those of your employers and other savings accounts.

If you follow these suggestions consistently, and get good advice from a financial consultant, this gives you the best chance to ensure that you are not overlooking any major factors in your plan and that you are on the right track to enjoyable retirement years.

A Woman's Retirement Reality-What She Really Must Know

Note: This article is directed towards working class women, and explains what they can do to empower themselves to ensure a retirement lifestyle they can enjoy. 

Sure, a life of leisure filled with family and friends, shopping and travel, is preferable to being left financially stranded in retirement, but it requires proper planning. You will see that even when accustomed to a high level of income, and/or a high standard of living, many women are eventually left to fend for themselves.

Consider this piece to be a financial re-orientation for women relative to their ability to retire. This article will discuss what she knows to be true, as well as what she can do to empower herself to ensure a retirement lifestyle she can enjoy…

I believe this should be viewed as required reading for all women, and those who love them. Regardless of your marital status, you, your spouse, your partner, or your significant other, should embrace a strategy today to ensure a safe plan for retirement.

Unfortunately, what you are about to read happens far too often and, as a woman, you owe it to yourself to invest a few minutes of your time, and learn what you can do to ensure that this all-too-typical story doesn’t happen to you. I am willing to bet that this story can change everything for you. You deserve a much happier retirement than that portrayed in this story, and you have the ability to make better decisions, jointly or alone — and place yourself on a course towards a safe plan for retirement.

Women really do face greater retirement challenges than they may know, and are in danger of living out their retirement years unprepared — these are facts. Without proper planning, women may find themselves as members of the working poor, or even worse. In order to prevent such dire circumstances, men and women must change their planning strategies before it is too late. My hope is that you may be enlightened by taking to heart the real-life economic outcomes discussed in the story “Lifetime Income for Women: Her First Job at 55”.

As you are already well aware, women and men are different in terms of money. They make different decisions for different reasons, and women usually outlive their husbands and often end up facing the world alone, without ample retirement savings or income. On a regular basis, women are forced to endure the effects of bad financial decisions made years ago, and many times, those decisions were made by a spouse.

Everyone has different expectations of retirement, meaning there will be various levels of “hoped for” comfort. These expectations are not necessarily based upon a couple’s level of education, or whether or not they had a career with higher or above average income. Keep in mind that folks who make more money may tend to spend more, and may take on more financial risk. Thus, they find themselves or leave their spouse, in even worse shape. They end up with greater debt and greater monthly maintenance costs than those who earned less and lived more moderately. Often, it is presumed that others are in better shape, but; a) it doesn’t matter, b) they probably are not, and c) you must take care of yourself anyway, especially since men often die before women do.

What should you do?

After reading this brief story –and getting a dose of retirement realities pertaining specifically to women — take action and get organized in an effort to get a snapshot of your current financial position. After that, you can assess your needs and wants, and your ability to live with the ups and downs of the fluctuating economy with an insurance advisor you trust.

Take the time to find out what you need to do to reposition assets, ensuring that your retirement income needs are met. Make an appointment, review your situation together, and view an income plan analysis to see where things stand for you.

You will learn that there is something that can be done to secure your future. Women and men alike have only one shot at astute preparation and execution of a safe plan for retirement…