All of this can drain your retirement dollars. Saving money has been a challenge for baby boomers. This puts its enormous importance in a clearer light, and it may make you less likely to use these dollars to buy that new car that you do not really need. It will help you put things into perspective. These plans can be set up easily with little effort and paperwork.
Diversification is also an essential element of portfolio success because it spreads the risk.
Financial experts have a variety of pie charts that slice investment plans into sectors depending on an individual,s age, needs, and goals. Whether you pick your own stocks or leave that task up to a mutual fund manager, you should have all three stock groups in you investment portfolio. Because they do not necessarily rise and fall in tandem, they will balance your risk. Again, look for future columns on asset allocation. There is simply no wiser long-term investment strategy.