Retirement Strategies

Retirement strategies can vary substantially depending on a number of different factors, including your risk preferences, age, income and long-term retirement goals. Finding a local financial advisor who can sit down with you and talk over the best options for your unique situation is one of the best resources you can have in navigating the many strategies available. With information and advice available from so many different places, including the Internet, your friends, colleagues and investment companies, finding a personal advisor can help you find the best options for you.

Basic Retirement Accounts

No matter what your financial situation is, some strategies are universally advantageous to everyone. Before you even begin thinking about stocks, bonds, mutual funds 401k accounts and other financial savings plans, assessing your ability to save can help you determine exactly how much you have to contribute to your retirement funds. If you have credit card debt or other high-interest loans, a financial consultant will likely advise you to first put your energy into paying off these balances. Since credit cards often carry interest rates of 9 percent or higher, no savings account or investment is likely to match the accumulated interest that builds as you delay paying those balances. If you start with a clean slate with no debt, you can put your full focus on retirement strategies without losing money to high interest rates on revolving debt.

Retirement strategies often start with a simple 401k account or an IRA. These options are easy to set up and even simpler to maintain since contributions can be deducted directly from your bank account. One advantage of 401k and IRA plans, particularly as you start thinking of retirement strategies, is that there are no restrictions to holding these accounts and other types of retirement accounts at the same time. You can even have a 401k and an IRA at the same time, although it's a good idea to ask your financial advisor if and when this is advisable. Some advisors recommend opening a Roth IRA with your 401k if you choose to enroll in both, although this will depend on your income and tax situation. A 401k account is always tax deferred, so this is one of the most preferred strategies, but your employer must offer this plan for you to be eligible. An IRA is a good option no matter what your occupation is, even if you are self-employed. If you earn taxable income, you can enroll in an IRA.

Conservative Investment Strategies

As your savings starts to build, you will likely consider investment strategies beyond your 401k or IRA plans. Risk is one of the biggest factors that can determine your investment strategy. If you are young with a high level of steady income, you can afford to be more aggressive with your retirement strategies. If, however, you are like many people who have delayed thoughts of retirement until your 40s or even 50s, you might want to choose a more conservative approach to ensure that your money will be there for you once you retire. Conservative retirement strategies place an emphasis on conserving your capital and ensuring a steady, low-risk return. These investments might include money market funds, Treasury bonds or fixed income securities. Your financial advisor can explain each of these options and help you determine which ones best fit your long-term strategy.

Assertive Investment Strategies

If you are in your 20s or 30s, you can probably afford to wait out the ebbs and flows of the market and will likely see the best return with a varied portfolio. If you have funds to invest, you can consider assertive to aggressive retirement strategies that carry a little more risk than you might find comfortable as you near retirement age. Common stocks are a popular option for young investors, as are mutual funds and other equities. Some high-income investors also consider hedge funds, although these are among the riskiest options. Before choosing any retirement strategies that involve higher-than-average risk, speaking with a personal finance expert can help you determine how much of your savings you can afford to invest in this strategy and what investments you can choose to balance your high-risk accounts.

Flexibility is another important factor to consider no matter what type of strategy you choose to follow. As you start thinking of retiring, you will likely want to shift your savings into more liquid accounts so your money is more readily accessible. Since your income might change or you might encounter unexpected financial hardships, it is also advisable to maintain some flexibility in what you commit to contribute each month to various accounts. Since determining the best retirement strategies for you can be a complicated process given the number of investment options and accounts available, choosing a personal finance advisor can be a sanity-saving resource when planning your financial future.

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