In every investor’s life, a day comes when they must decide what level of risk their budget can tolerate. This decision, to a large extent, will ultimately determine what type of investor they are.
Here is a quick rundown on what you need to know to understand this rationalization at the various stages of your life:
Several Decades to Retire – With forty or more years at their future disposal, young investors can make reasoned and sober financial decisions. The power of compound interest is their best friend as it can take an investment of as little as $200 a month and turn it into a million dollars after four decades.
A Single Decade to Retire – For those individuals in their forties – at the prime of the earning potential and with most of their financial obligations behind them – this is the time to invest significant sums in blue chip stocks and index funds. Simply ride the market as it rises and a comfortable retirement should be well in hand.
Less than a Decade to Retire – Whether or not you have accrued a sizable nest egg throughout your life, now is the time to decide how to dispose of your estate. Of course, you will want to provide for yourself and your spouse, but inheritance issues are also relevant. Consider obtaining professional advice when it comes to this stage in your financial life.
A Final Note on Tax Planning – No matter type of investor you are, the government will always wants its share. More importantly, they have the power to enforce their jurisdiction so you must plan for this eventuality accordingly. Nowhere is this fact more evident than in estate planning. In short, get good advice before you die or all your hard work may very well be in vain.
As you can see, there is a wide variety of investor types and not just because of age. For more information on this topic and on the best investing habits to fit your particular lifestyle, please contact us at Superior Debt Relief. We can be found online or you can be reach us directly at 866.896.7616 with any of your questions.