As one nears retirement, they must become more aware of the needed financial stability that comes with sound investment strategies. This involves examining the best options available to guarantee that one’s retirement portfolio will allow for peace of mind and various perks, from guilt-free shopping to traveling the world.
The first low-risk, high-gain option is P2P or peer-to-peer lending. This is an online investment that matches borrowers and investors in mutually beneficial loans. It is worth considering as among the primary investment choices because it often pays out higher interest rates than your typical stocks.
A good second choice is annuities, investment contracts between an investor and an insurance company. Annuities come in various forms and can either be variable or fixed, but usually come with a guaranteed return by a particular date. Though these often hinge on how the stock market fares, your contract may include a provision that limits downside risks.
Finally, you should look at real estate investment trusts or REITs. Here one invests in mortgages and direct equity positions from different properties. REITs pay dividends to their investors, yields that are often higher than what you stand to gain from stock dividends. This is a great option when the stock market is in decline, as they are not correlated with exchanges in stocks.
Barry Bulakites is a recognized innovator in the field of financial services. The president and chief distribution officer of Table Bay Financial Network, he is responsible for some of the industry’s unique platforms including America’s IRA Centers™ and America’s Tax Solutions™. More on Barry’s work here.
Retirement planning is the type of planning one does to be prepared for life once paid work ends. This includes not just financial conditions but all aspects of life, such as lifestyle choices given the newly acquired free time, where to live, and when to completely quit working. On the financial side, it means identifying sources of income, estimating expenses, managing assets, as well as implementing a savings program.
Government-sponsored retirement via Social Security and pension benefits, for instance, is facing issues that include an aging world population and fewer working-age individuals contributing to Social Security systems. Private pension plans aren’t immune to problems, too, with the real possibility of corporate collapses that can lead to employer-sponsored stock holdings getting wiped out.
Those who are planning to retire soon should have a checklist of things to do. This includes knowing when one can realistically retire, learning how medical care can affect one’s expenses, studying how Social Security timing will affect one’s income, making a plan for debt payment and management, and keeping one’s financial and lifestyle plans on track.
Thus there’s a need for effective retirement planning, whether in young adulthood (ages 21 to 35), early midlife (36 to 50), or later midlife (50 to 60). One needs to pay attention to one’s home and existing home equity loan; estate plan or what happens to one’s assets after death; tax efficiency, where most of retirement accounts are taxed as ordinary income tax; and insurance such as navigating the Medicare system.
As life tends to throw a curveball from time to time, it’s important to be flexible when dealing with changes, such as grappling with unforeseen illnesses.
Barry Bulakites is the president of Table Bay Financial Network and is a recognized innovator in the field of financial services. For similar topics, subscribe to this blog.
In bear markets, investors see huge chunks of value shaved from the securities they own. While many investment strategies are equipped for weathering the losses incurred throughout the business cycle, they cannot always hedge against downturns as large as bear markets.
Shares that lose value too much, too soon during a bear market can be costly for investors. A drop of more than 40% of a share’s value, for instance, would require a rise in value of 67% to recoup the losses. The turnaround cannot always be counted on even when markets recover. Typically, investors often must cut their losses during a bear, which means dropping poorly performing investments before they hemorrhage value.
For many average investors, prevention is the key to surviving a downturn as big as a bear market. The adage of putting eggs in more than one basket is in play. A diversified investment portfolio ideally shouldn’t just consist of stocks, not even during more bullish times when the gains from shares are intermittently more lucrative.
Investment products that make great hedges against bear market include fixed-income annuities, which provide no loss of principal while providing ways to track and lock in gains. Although their growth potential isn’t as high, they provide a good hedge against abrupt market fluctuations.
A widely-regarded innovator in the field of financial services, Barry Bulakites is co-founder, president, and chief distribution officer for Table Bay Financial Network and is one of the industry’s most sought-after speaker. Learn more about his company and its services from this website.