Investment Options For A Secure Retirement

It is important to develop a financial plan for your retirement, and your financial plan should start with investing. Investing will help ensure a steady source of income long into retirement, making your life much easier and more pleasurable.

The following are brief descriptions for new investors to help familiarize themselves with the many different kinds of investment options available:

401K Plans

401K Plans are the most common type of investment and one that almost every worker has. The reason for this is they are the easiest investment because they require very little attention on the part of the workers who have them.

They are so easy that workers don’t even have to worry about contributing to them, as their employer does it for them. In fact, most workers with 401K Plans never even notice the deduction from their paycheck.

However, be sure to check what age you can withdraw from a 401k though, as this will affect when you can retire.

Stocks

Stocks are a common type of investment amongst the population who makes more than $125,000 annually; however, it is growing more common to see more middle-class households invest thanks to the availability of online investing and lower fees companies offer. Investing in stock is a wise option and provides great returns for your money.

If you decide to use this option you may want to strongly consider hiring a broker to guide you in the decision-making process; however, if you can’t afford a broker, you will want to make sure and conduct thorough research before investing. Many helpful websites offer great advice.

Real Estate

Real Estate is one of the most lucrative investment options available, and thanks to lax lending standards almost everyone can invest in real estate with little or no money out of pocket. Buying real estate and renting it to tenants is a great way to ensure long term income streams for you long into retirement.

People will always need a place to live, and property is one thing that can’t be created or grown. In fact, before considering the other options listed, you may want to strongly consider investing in real estate.

Bonds

A bond is a promissory note from the government or a private company, in which you loan them a certain amount of money, and in return, they agree to pay you back with interests in a set amount of time.

Bonds are a safe way to ensure that – at the very least – when the term of the bond is up and you cash it in, you will walk away with your initial investment.

Mutual Funds

Mutual funds usually reward the broker in charge of them better than the investor, but they are still an available investment option, and one which requires less risk on the part of the investor.

Essentially, what occurs when investing in mutual funds is that a broker manages your money and invests it in a list of various stocks so that your money is diversified and the risk of you losing it all is lessened.

Money Market Funds

Money market funds are a safe short-term investment option. This kind of investment makes you an independent shareholder in the company in which you invest and requires you to pay only $1 per share.

In addition, these investments often come with check writing privileges, allowing you to use the money whenever you need or want to.

Annuities

Annuities offer you the chance of developing tax-deferred income. Annuities are an agreement between you and an insurer, in which your investment protects your earning potential should you run into job problems during your life.

Brokered Certificates Of Deposit (CDs)

Of all the investment options available, CDs offer the lowest return for your money.

However, the upside is that you can use the money at any time without paying penalties, even though you agreed to deposit the money for a set amount of time. Life is unpredictable, so this is a nice option to have.

By making use of the options outlined in this article, you have the chance to set yourself up for a rich and fulfilling retirement!

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