By Evan Vitale
Most people in America are hard workers. We are a nation of workaholics, according to citizens from other nations around the world. We work on average over 40 hour weeks and more than 20 percent of Americans work 49 hour weeks; 11 million Americans say they regularly work 59 hour weeks. But what are we working towards? Yes, many are truly passionate about the jobs they have or the businesses they run and the work is its own reward. Even the people who say that must, however, look forward to the peace and professional freedom that accompanies retirement.
Retirement doesn’t mean being trapped in an armchair watching TV. It can mean having the money and freedom to start a new adventure! So, in the interest of helping Americans reach retirement when they want, here are three easy tips to get there:
Set Goals for Savings
Retirement doesn’t have to be scary. These tips will help you plan a retirement at a time that works for you.
There is no real way to know how much you might eventually make no matter what job you have. But, you can, with a little thought and a few rows in a spreadsheet, decide exactly how much you would like to have to get by for the last 20, or even 30 years of your life. So, how do you get there? A solid rule to follow is to save 10 to 15 percent of your salary every year.
If you can do this – especially if you are able to invest it a safe, slow growing fund or retirement account – and start early, it is amazing how the money can add up. Compound interest will make that money really grow over the years!
Balance your Portfolio
Everyone knows there are risks that come along with investing. No one, not the top investors at big hedge funds nor the small private investor in his home in Middle America is safe from the unpredictable nature of the market if they only have one investment. That is why diversified accounts are recommended at every level to every investor.
By having your wealth distributed between many types of investments, stocks and bonds included, and many different industries and companies, you will have a solid cushion if one of those investments fail. You might grow a little more slowly, but you will also be much more safe should anything unexpected happen.
Make One Big Account!
Having diversification is key when it comes to investments but that doesn’t mean you need to have a ton of different accounts. It turns out that having all of your money in one large account is better because it makes it easier for whomever is managing your money to keep track of all the funds available. Also, having everything in one place allows for better chance for diversification. Two well managed but separate accounts might share similar investments, for example both might invest in the same mutual fund, and therefore the diversification of the portfolio as a whole is compromised. So, when you are getting ready to retire, you might consider rolling all of your funds into one, easily managed, well diversified account.
Follow these tips and you will be able to have a much better shot at retiring when you want!
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