This is the third part of the series of what investments to choose. It all depends on individuals risk tolerance. The people who are nearing retirement need to be aggressive about their investment, investing in the stock market, putting money in the CD (although the rate of return on it is pathetic), buy tax free municipal bonds (although I am not sure how long will it be when we the tax payers will have to bail out some municipality), real estate, buy government securities, etc.
The people who are young (meaning the one below the 50 year age) need to investment in some high risk investment (As they say in Finance, high risk high return) like stocks, max out their 401K (again although I don’t like 401K but it may be the perfect investment for most of the people) may be some real estate, put in some IRAs.
All my point is that you people need to diversify your portfolio (meaning investment) and not put all eggs in one basket (meaning not put all of one your money in one investment).
I read some stories long time ago that some of the people put all their funds that they have in 401K in their company’s stock and they lost all of it when the company went down ( Bad idea-never do that).
My favorite one will be very controversial but that is just my opinion, it is real estate.
Which I will discuss in more detail in my next post.
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