You’ve probably heard of dollar-cost averaging (investing a fixed amount of money at regular intervals over a long period of time to minimize the impact of volatility), but what about “dollar-cost ravaging”? The strategist interviewed in today’s article sees dollar-cost ravaging as a problem that can cause a lot of damage to the portfolios of retirees – especially in the early years of retirement. What is dollar-cost ravaging – and what can retirees do to help avoid it? CLICK HERE.
While fixed income investing tends to be associated with retirees (and, indeed, retired investors are one of three investor profiles that the author of today’s article believes should consider devoting a significant part of their portfolios to fixed income), it’s an investing strategy anyone can benefit from, with the author noting that “The low-risk, predictable nature of this investment can add essential stability relative to the uncertain nature of stocks and commodities.” For more on fixed income investing – including different types of fixed income investments, the benefits (and risks) of fixed income, and the two other investor profiles that, along with retired investors, may want to consider a significant allocation to fixed income – CLICK HERE.
Required minimum distributions from retirement accounts are generally unavoidable for retirees – unless they want to incur a substantial penalty for not taking them. For those who don’t need the money (or the tax bill), this can lead to resenting RMDs. Today’s article, however, outlines how, rather than being a necessary evil, RMDs can actually serve as an opportunity to improve your portfolio: “The starting point for approaching RMDs is to check up on your portfolio. Armed with knowledge of its problem spots, you can then concentrate your RMD-related sales in those areas you wanted to fix anyway.” For more, CLICK HERE.
“A lifelong, low-cost investment strategy that I believe is likely to produce superior long-term returns without much attention from you” is what the author of today’s article lays out. The strategy in question is comprised of two “building blocks” – a target-date retirement fund at the core and a “booster fund” to generate higher long-term returns with little extra risk. For more on this strategy – including which type of fund may provide the greatest boost and a formula for determining how much of your portfolio to devote to each component – CLICK HERE.
Despite a number of anxiety-inducing market routs, stocks have performed quite nicely this year. That impressive performance, however, brings with it some potential problems for investors, including off-balance portfolios and taxes on gains. As the author of today’s article notes, “a lofty market environment presents a lot of potential tax traps, as the appreciated winners in a portfolio that are most in need of trimming also carry the highest embedded gains.” As such, she proceeds to outline some strategies to minimize your tax bill in this lofty market. For more, CLICK HERE.
The expectation in some circles is that emerging markets will be the only category of equities that will generate a significant return above inflation over the next 7 to 10 years. Given this, retirees may be tempted to allocate a sizable chunk of their portfolio to emerging market equities. Today’s article, however, outlines why retirees may be well-served to reconsider such a move, cautioning that “there are more ways to lose money and make substantial errors investing in emerging markets than there are in developed markets.” For more, CLICK HERE.
The retirement financing strategy highlighted in today’s article is sometimes referred to as “safety first” – a notion that may be taking on even greater importance for retirement savers in light of recent market gyrations. The strategy in question is the “floor-and-upside” strategy, where “the basic idea…is that a retiree devotes some of her retirement funding assets to building a lifetime stream of income and the remainder to an investment portfolio to provide liquidity and the possibility of increasing wealth over time.” For more on this strategy, CLICK HERE.
It can have a dramatic impact on your retirement – and, unfortunately, it is largely out of your control. We’re talking about the market’s sequence of returns leading up to – and throughout – your golden years. The author of today’s article illustrates the impact that differing sequence of returns can have on the equity portion of one’s portfolio and, noting that individuals thinking of retiring in the next year or two “are vulnerable to an unlucky sequence”, looks at some strategies to mitigate this threat. For more, CLICK HERE.
In 2013 the author of today’s article made a move that was considered irresponsible at the time and added bitcoin to the alternative investment portion of his retirement account. He then proceeded to lose half of his investment in an ensuing price drop – and called “stupid” for this investment blunder. However, he held onto his position in bitcoin and has subsequently come to view it as the best investment in his retirement account. So does bitcoin belong in retirement accounts – and are retirement savers missing out by sticking with the same old “status quo” investment options? CLICK HERE for more.
“Is there a hybrid solution that can give you some of the lifetime income of an annuity, while offering the inflation protection and principal availability of an investment portfolio?” This is the question that the author of today’s article poses before examining one possible option in that regard: managed-payout funds. After delving into the managed-payout funds (and related investment products) offered by some big players, he provides an overview of the pros and cons of these retirement income vehicles. Are they really “one-stop shopping” for retirement income? CLICK HERE.