Choosing the right retirement plan

asset-all-8When you are in your 40s, you should be worried about your retirement plans. In face, you should sort out ways to invest for your retirement once you get a stable job. You should invest carefully and so it’s always better to hire a professional. Pensacola Florida Smartvestor pro SVP Brent Wadzita Dave Ramsey investments can help you. Dave prefers investing in different mutual funds. The more funds you spread in, the risk associated with it is less.

Investing in mutual funds is the safest option. There are many types of mutual funds. You can also invest in Exchange Traded Funds (ETFs). These are very similar to mutual funds. Managers are not employed to choose companies for the ETF to invest in. ETFs are baskets of single stocks that are designed for trading on the stock market exchanges. This makes the fees less. You can ask your investment professional to help you understand how ETFs work.

Dave doesn’t prefer investing in single stocks for retirement purpose. Investing in single stock is similar to putting all your eggs in one basket.The value of the stock is dependent on the company’s performance. So, it’s a big risk to invest in such kind of stock. Certificates of Deposit (CDs) are also not good for your retirement investments. They offer very low interest rates. They cannot keep up with the inflation. It will take more time to build up wealth. Bonds are also not part of Dave’s retirement investment strategies. They prefer ‘safe’ investments. The values of bonds rise and fall very rapidly.

Fixed annuities are complex accounts that are sold by the insurance companies. They guarantee income for a period of time. These are expensive. Variable annuities are a complicated investment accounts also. It provides guaranteed income and death. While you are saving 15% of your income for retirement, you should start saving for your children’s college as well. But retirement savings comes before college savings. Your children will have many options to pay for their college, like grants, scholarships, part-time jobs, etc.

You can have long term care insurance to help you protect your savings in case you or your partner falls ill. When you reach the age of 60, the need for your long term care increases. You can invest in disability insurance as well. Life insurance is another policy you can choose. This is 10 to12 times your income and will let your family maintain a decent lifestyle once you are gone. You can start with a 15-year or longer policy. All these types of investments will help you to survive when you retire. So, choose a plan carefully to get the most benefit out of it.