By : Tricia Borren
For those looking to save for retirement, the planning process involves more than simply storing cash away each month in a 401(k). To live comfortably and have the opportunity to retire at an appropriate age, there are several investments to made that are crucial for a sizable fund that will last an average of 30 years or more.
Stocks are a great way to invest in several different companies and gain a large return over several years. It’s important to invest in companies that are already making a profit and have high prospects for the future. The best investments in stocks are also those that earn 10 percent more each year.
2. Real Estate
Investing in luxury homes for sale can prove one of the largest returns for retirement funds, whether flipping homes or renting out commercial property. Although a bit of risk and patience is required, it will pay off in the long run for a hefty retirement fun.
3. Roth IRAs
Roth IRAs are a great way to invest without being taxed, as up to $10,000 in earnings can avoid tax penalties. The assets can also be passed down to heirs, as well as given to a spouse who already has their own IRA.
4. Closed-End Funds
Many people prefer to invest in closed-end funds for their retirement due to the quarterly or monthly income that can be earned. It’s another type of mutual fund that usually offers a discount and range from bond funds to U.S. stock, while paying out higher rates because they are more heavily invested in income-producing assets.
Bonds work to benefit your retirement income by essentially loaning out money to companies or even the government, accruing interest that can work to be substantial with the principal returned when the bond matures. A portion of a portfolio should be invested in bonds, and they’re a great way to know how much of a return to expect with semiannual payments. It also is an ideal option for investors as they preserve their capital investment.
Whether investing in stocks or building the majority of your portfolio in real estate, there are a number of options available to steadily build the retirement fund over several decades that will work to provide a comfortable lifestyle in the later years of life with careful planning and patience.