How many people have the majority of their retirement savings invested strictly in equites? Nearly 80% of all retirement assets were invested in mutual funds and stocks according to the Investment Company Institutes’ US Retirement Market report published in Q3 of 2008. What are the advantages to diversification? True diversification is NOT owning different stocks and mutual funds no matter what your stock broker tells you. True diversification involves spreading your retirement beyond equities to include investments in asset classes such as:
Real Estate (Land and Property)
Fixed Income (Bonds)
Commodities (Grain, Gold, Oil)
Cash Equivalents (Money Market)
You can hold all of these investments tax-deferred within a self-directed IRA, permitting a greater, and true, diversification of assets.
Advantages of Diversification
Why should you diversify your retirement portfolio? A well-diversified portfolio helps to reduce the risk of substantial losses in a range of economic conditions and provides steady, proven growth to your retirement account. Retirement investing should be less about shooting for the stars and more about avoiding the sinkholes. If you're not already, let this current downturn be your wake-up call and diversify your retirement savings NOW before the next downturn delays or severely alters your retirement plans.
This site is not intended as, and may not be relied upon as, tax, legal, investment or other advice.
Readers desiring such advice should consult their own advisors.
