For Mark Roberts’ Use: As you probably already know, the burden of retirement planning falls on you. Social Security was never meant to fully fund your retirement, so you will rely upon your own savings or investments to provide the income you need once you retire.
That realization can add up to a lot of pressure, and unfortunately people tend to make mistakes when they’re stressed. As you continue to plan for retirement, remember not to make these investment mistakes.
Don’t think in the short term. Unless you’re retiring in the next year or two, short-term changes in the market don’t affect you as much as you think they do. On numerous occasions, people have sold their stocks when they felt they had recovered sufficiently from a loss, only to learn years later that they would have made so much more money by staying in the game! On the other hand, we have also seen people panic and sell stocks when they drop a bit, when the could have easily recovered their money within a year or two. Remember, investing is usually a long-term exercise in patience.
Don’t compete too much. People often become so focused on “beating the market” that they forget why they’re really investing. You’re not going for the gold at the Investment Olympics. You just want to save a sizable nest egg and enjoy a comfortable retirement. So rather than trying to develop psychic powers or stressing yourself over each and every point in the stock market, remember that gradual growth is your true goal.
Don’t borrow from yourself. Your investment strategy is all about retirement security. Don’t get so hung up on temporary goals, like a new house or car, that you neglect your retirement savings or even borrow from it. Make saving for your future a top priority, and let everything else fall into place behind it.
Your retirement fund made some great gains last year, so you must have hit upon a winning strategy, right? You should keep everything just the way it is? Wrong! Remember the old saying: No one ever went broke taking a profit. Just because a strategy worked well last year doesn’t mean that it will continue to work in the future. You could even open yourself up to a significant loss, if you don’t continually reassess your investment strategy. Rebalance your portfolio regularly to take advantage of market strengths, while protecting your hard-earned principle from loss.
For more help with your investment strategy, call our office to schedule an appointment. We specialize in helping people like you plan for secure, stable retirements.
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