- Gold, Silver, Wine Trading



Forgot Password?
  5 Mistakes Investors Make By Going Solo On Their Retirement  
  Lorimer Wilson on 2018-03-04 02:30:00.0

Many Americans have taken it upon themselves to do the vast majority of retirement planning without the help of a financial advisor. While that is perfectly fine and legal, it is not entirely wise considering the long-term margin for error. Plenty of things can go wrong, and they do, often leaving investors lost and confused about what they can do to better their circumstances. There are 5 major errors committed by solo investors that can greatly impact their ability to maintain wealth throughout their retirement. Here they are!

The original article has been edited here for length (…) and clarity ([ ]) by - A Site For Sore Eyes & Inquisitive Minds - to provide a fast & easy read.

1. Being Too Conservative

Most of us remember the market meltdown in 2008-2009 and don't want to risk losing copious amounts of money in the stock market. Unfortunately, being too conservative with your investments, especially when you're young, can be a huge mistake. A good rule of thumb is to subtract your age from 100 and this is the percentage of your portfolio that should be invested in stocks. For instance, if you are 30 years old, then 70% of your portfolio should be in stocks and 30% should be in bonds. However, this suggestion is a bit dated since Americans generally are living longer: instead, increase that number anywhere from 110 to 120 (depending on your longevity expectations), and you may even find that your portfolio should consist of 90%-100% of stocks while you are young.

2. Being Too Aggressive

On the other hand, being too aggressive with your portfolio, especially when you are older and closer to retirement, is not good either. The closer you are to retirement (generally about 5 years out), the more you want to ensure your wealth is preserved to avoid the risk of losing it all in the stock market right before you stop working. Around this time, you should be sure that the bulk of your portfolio has exposure to the bond market, and a smaller percentage in the stock market.

3. Forgetting to Re-balance

An overwhelming number of investors don't even know what re-balancing is, let alone remembering when its time to do so. Re-balancing is the process of double-checking to make sure your money is allocated properly in terms of overall amounts. It's essentially a way to make sure that your investments stay in line with your long-term goals. However, this can be difficult to do on your own so be sure to stay educated on this process, especially if you are going solo in retirement planning.

4. Investing in Cash

While more people are keeping cash in the bank rather than stuffed in a mattress, keeping your wealth in the form of cash is a terrible way to build wealth over the long-term. Why? Cash loses value over time, returns on savings accounts are close to zero, your purchasing power will go down over time due to inflation.

5. Not Avoiding Hidden Fees

According to Inc., a whopping 92% of Americans don't know what they are paying in fees on their long-term retirement accounts. This is a HUGE problem, especially if you're managing retirement money solo. Forbes recently noted that a mere 0.93% difference in hidden fees between two funds can cost up to $215,000 for a single investor over their investing life! How? Compound interest…it's a powerful thing.

Scroll to very bottom of page & add your comments on this article. We want to share what you have to say!

Related Articles From the munKNEE Vault:

1. 7 Ways To Catch Up On Savings For Retirement

With longer life spans, inflation, and increasing health care costs, it's possible that many retirees won't have enough to comfortably sustain their retirements. Here are 7 smart moves will help you catch up on savings even late in the game.

2. How Much Do I Need To Retire?

There are all sorts of rules of thumb about saving for retirement but, while they can be helpful as a baseline for setting expectations, you need to make a plan and monitor your progress as you age to be effective in the real world.

3. 7 Roadblocks to Retirement & How to Overcome Them

It's nice to think about the day when you can…spend your time relaxing, traveling, and enjoying life to the fullest. Well, if you want that dream to become a reality, you may need to make some significant life changes now.

4. 6 Arguments For Maxing Out Your 401(k) Contribution

Maxing out your 401(k) is often the best way to accumulate a healthy sum for retirement, and there are great tax benefits as well…Consider these 6 arguments.

5. How Much Do I Need To Retire?

There are all sorts of rules of thumb about saving for retirement but, while they can be helpful as a baseline for setting expectations, you need to make a plan and monitor your progress as you age to be effective in the real world.

6. 4 Red Flags That Your Retirement Plan May Be Off Track

How prepared are you for retirement? Take a look at the following potential unpreparedness indicators. After reviewing them, if you don't see any concerns, you may, indeed, be headed down the right path toward retirement. However, if you do, it'll be far better to address them now while you're still gainfully employed.

7. Robert Kiyosaki: ?It's A Myth That Your Cost of Living Will Be Lower When You're Retired! Here's Why?

America is facing a retirement crisis. It is a ticking time bomb and most people have their heads in the sand. The long and the short of it is that the older you get, you don't spend less, you just spend differently - and more. The fun goes down and the healthcare costs go up.

8. You Might Be Saving TOO MUCH for Retirement ? Here's Why

How much money do you really need to retire on? We're bombarded with messages about retirement savings ? that…[we] haven't saved enough; that company pension plans are underfunded; that the Canada Pension Plan [or U.S. Social Security] won't be able to handle the influx of boomers who are set to retire over the next 10 to 15 years. If that's you, then you might be panicking right now. Stop! According to a new book retirees may not need as much as they've been led to believe.

9. Afraid You Might Outlive Your Savings? Take This ?Life Expectancy? Test

Medical researchers have created a quiz that predicts how long you're going to live [i.e how many years you will live into retirement - if any!]. It's called a ?mortality index? and it's composed of 12 questions. It claims to predict with some accuracy whether you'll live out the decade.

10. Don't Put Your Retirement At Risk! Avoid These 5 Less-than-ideal Money Moves

If you're stressing out about whether or not you're saving enough for retirement, you're not alone. Millennials are among those struggling the most with this dilemma. According to a 2016 study, 64% of working millennials believe they'll never save a $1 million nest egg. Why are millennials so worried? Sadly, this age group is prone to making less-than-ideal money moves that could hurt them later in life. Let's review the five biggest ways in which millennials are risking their retirement.

For all the latest ? and best ? financial articles sign up (in the top right corner) for your free bi-weekly Market Intelligence Report newsletter (see sample here) or visit our Facebook page.

The post 5 Mistakes Investors Make By Going Solo On Their Retirement appeared first on munKNEE

Market Categories Search Symbol Trade Register Other Links FAQ Blog Editorials Charts Contact Us Terms Bookmark and Share Site Meter