With these best investment strategy managing your 401k or IRA investment assets could be greatly simplified both now and in the future. You’ll likely change jobs when you retire, and with out a long-term investment strategy for asset management you might lose control of your retirement nest egg like millions of other Americans have.
In a normal, traditional 401k plan asset management basically amounts to picking mutual funds to invest in. The method is named asset allocation and most of your investment options are either stocks funds, bond funds, or balanced funds which are a mix of both. An average plan includes “safe” options just like a money market fund or stable account that simply pays interest as well. In putting together an investment strategy the best investment portfolio will include all three of these asset classes or fund types: stock funds for growth, bond funds for higher income, and a money market or stable fund for interest income and safety.
Your own personal best investment strategy or best investment mix (asset allocation) depends on what amount of risk you’re willing to accept. For a lot of the people a lot of the time, these middle-of-the-road strategy of asset management spent some time working well. Keep half your investment assets in stock funds with the other half evenly split between bond funds and a money market fund or stable account. In this manner your investment portfolio risk is moderate, and your long-term returns ought to be respectable.
The key would be to KEEP your cash dedicated to this proportion over time scbam. Review your asset allocation or mix one or more times per year to remain on course with 50% in stock funds and 25% in all the other two. Move money around to rebalance to these levels once the numbers escape line. This can happen because each investment category will perform differently. As a result you can keep risk in order at a moderate level.
Now, what’s your absolute best investment strategy in order to avoid premature taxes and penalties; and to keep your cash working whenever you change employers? Simply execute a direct rollover together with your 401k money going directly into a mutual fund IRA with a major no-load fund company like Fidelity or Vanguard… each time you leave an employer where you had retirement assets. In this manner you can consolidate your retirement nest egg in a single place and simplify your future asset management task.
Other advantages include low-cost investing, a broad collection of funds to select from, and good service at no charge. With a toll-free call a service rep will walk you through the method to help you set things up, and help is available whenever you need it. This IRA will be your retirement nest egg where the best investment strategy and asset management discussed before can do the job throughout retirement. As you obtain older you merely change your investment mix to favor bond funds and money market funds vs. stock funds for less risk and more income in retirement.
A retired financial planner, James Leitz comes with an MBA (finance) and 35 years of investing experience. For 20 years he advised individual investors, working directly with them helping them to attain their financial goals.