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Retirement planning has never been easy. Saving for your golden years is a goal constantly fighting for attention alongside more immediate financial needs, whether it’s saving for your first mortgage, paying off debts, or planning to start a family.
There are always going to be competing priorities. The best you can do is set aside as much money as you can, right?
That’s not the whole story. How you invest your savings can be just as important as how much you can save, if not more. Almost everyone depends on the growth of their retirement savings in order to have enough. Otherwise, it just would not be possible to save enough to live comfortably after retirement.
Optimizing your investments based on your income, age, and financial needs will help you achieve your savings goals. While everyone’s financial plan will be different, let’s take a look at some of the changes you can make to optimize your portfolio.
#1 Sell Unworn Jewellery and Gold Coins
If you have any gold or silver jewellery that you no longer wear or a collection of coins that may have been given to you as a gift, you could be sitting on a lot of unproductive wealth.
While some people like to hold on to gold and silver as a way to protect their wealth, it may not be the best strategy if you have limited savings. Higher-risk assets with more growth potential may be better if you have limited savings.
The good news is that you can easily convert gold and silver jewellery into cash with bullion buyers like Muzeum. These buyers usually refine gold and silver jewellery to be recycled back onto bullion markets and are willing to pay competitive prices for your collection.
#2 Learn How to Invest Mutual Funds
The toughest thing about investing for growth is accepting risk. When you read about bad days on the stock market, you can get jittery about losing your hard-earned money. However, the stock market has historically delivered better returns than just about any other asset.
For most investors, choosing a mutual fund that fits your goals is better than attempting to buy stocks on your own. It can take a lot of work and research to perform better than mutual funds by buying stocks on your own.
#3 Learn How to Manage Risk
It’s also important to understand the distinction between realized and unrealized losses or gains. Stock market crashes are pretty much inevitable. If you are going to invest, you need to accept them and plan for them. Losses in stock market value only become important if you plan to sell your stocks soon. Until you sell, you still own the stock and haven’t realized a loss or a gain. The stock has time to recover its value unless you choose to sell.
Part of retirement planning is knowing when to buy which asset. The closer you get to retirement (and selling stocks), the more you want to invest in relatively safe, low-risk assets. That might mean more bonds or dividend stocks rather than growth stocks. The further you are from retirement, the less a crash matters, as you have more years to recover.
Get more out of your savings. By investing better, you can set yourself up for a more comfortable retirement.
