Earlier in the year we reviewed the various types of risk you might encounter when investing - inflation, market, credit, currency exchange, default, etc.; we won't review them at this point.
There is one risk that has become more important for up and coming generations than those in the past - the risk of longevity. Living too long - lasting longer than your money - has prompted many financial planners to project to 100+ when determining "if you have enough to retire".
85 is now considered old, not 60 or 70. With exercise, decent diet and medical advances we all can anticipate a long life. The question arises: can we afford to live a LONG life?
Four tips to finance your antiquity:
- Start early - savings compound over time giving you a jump start. This is probably the most important move to make.
- Save more - saving 10% - 15% of your income would cover your retirement provides a good beginning. If you can, increase that number.
- Be more aggressive in your investing - a combination of stocks and bonds will appreciate over time. Increase the stock portion. If you are very nervous and insist on conservative investments, you must save even more!
- Work longer - plan on retiring at 68, 70, 75. Today's seniors are healthy, vibrant and mobile continuing to earn income well into their future. Do you see yourself among them?
Be $ Smart - start NOW to make sure your money lasts as long as you do. Call me for additional ways to save.
Showing posts with label inflation. Show all posts
Showing posts with label inflation. Show all posts
Saturday, December 5, 2015
Saturday, November 1, 2014
Stock Market Turbulence
The market's up, the market's down - what is all the buzz about?
In the past few weeks the stock market has been bouncing like a rubber ball on speed. But in recent days, it appears to have lost the bounce.
The DOW (Dow Jones Industrial Average) is comprised of 30 stocks. Usually very large multinational US companies.
The S & P 500 (Standard & Poors, a rating agency) holds the top 500 US companies.
These two indices are what folks usually refer to when they speak of the "stock market". There actually are over 5000 companies publicly listed - meaning that you and I and millions of other people may buy and own shares. (There are also thousands of companies privately held - e.g. Mars, the maker of Snickers, M&M's, Uncle Ben's, etc. is owned exclusively by the Mars family of McLean,VA. that are not included in either index.)
The value of a company stock will go up and down depending on many factors. If world or local events or an accident (like an oil spill) give cause to think the company is in trouble and cannot perform well and grow, the stock will bear a lower price. And the reverse is true - if everything good is happening - good sales, controlling costs, general public optimism - the stock price will rise.
Right now there are many factors, both home and abroad, affecting why the stock market has fallen (prices/values have dropped.) If you view the stock market as a living breathing organism inhaling and exhaling, you might realize the market has been inhaling for a very long time. The stock market has been rising with no substantial correction (drop) for a few years. The market cannot grow without substance. There has to be employment growth, a sound economy and solid political leadership to build and sustain a rising market. "The market hates uncertainty" is a quote I learned way back in the beginning of my career. It has proven to be true.
So how does this affect you? If I showed you a graph of the stock market from 1900 through 2014 you would easily see an upward trend, with occasional down blips. Seeing that visual might ease your concerns.
Be $ Smart - be aware the market goes up and down daily, and over the long-tern the trend has been up. It's the best way to make your money grow long term and to keep up with inflation.
The next $ Tip will take a look at how you feel/react to the ups and downs of the market - also known as Risk Tolerance.
In the past few weeks the stock market has been bouncing like a rubber ball on speed. But in recent days, it appears to have lost the bounce.
The DOW (Dow Jones Industrial Average) is comprised of 30 stocks. Usually very large multinational US companies.
The S & P 500 (Standard & Poors, a rating agency) holds the top 500 US companies.
These two indices are what folks usually refer to when they speak of the "stock market". There actually are over 5000 companies publicly listed - meaning that you and I and millions of other people may buy and own shares. (There are also thousands of companies privately held - e.g. Mars, the maker of Snickers, M&M's, Uncle Ben's, etc. is owned exclusively by the Mars family of McLean,VA. that are not included in either index.)
The value of a company stock will go up and down depending on many factors. If world or local events or an accident (like an oil spill) give cause to think the company is in trouble and cannot perform well and grow, the stock will bear a lower price. And the reverse is true - if everything good is happening - good sales, controlling costs, general public optimism - the stock price will rise.
Right now there are many factors, both home and abroad, affecting why the stock market has fallen (prices/values have dropped.) If you view the stock market as a living breathing organism inhaling and exhaling, you might realize the market has been inhaling for a very long time. The stock market has been rising with no substantial correction (drop) for a few years. The market cannot grow without substance. There has to be employment growth, a sound economy and solid political leadership to build and sustain a rising market. "The market hates uncertainty" is a quote I learned way back in the beginning of my career. It has proven to be true.
So how does this affect you? If I showed you a graph of the stock market from 1900 through 2014 you would easily see an upward trend, with occasional down blips. Seeing that visual might ease your concerns.
Be $ Smart - be aware the market goes up and down daily, and over the long-tern the trend has been up. It's the best way to make your money grow long term and to keep up with inflation.
The next $ Tip will take a look at how you feel/react to the ups and downs of the market - also known as Risk Tolerance.
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