Retiring on a Bed of Flowers
Investing money into a non-diversified portfolio is like trying to grow a garden in one small pot. Whereas a garden needs much space to grow, money must be invested into a well diversified portfolio it order for the money to grow. What most people do not realize is that inflation is strong and the money you put in a savings account or hidden away, will not beat out the rise of inflation over the years. By investing money diversely, you can beat out inflation, retire comfortably, and achieve these by investing in the right asset classes.
By investing your money, you can live comfortably in your retirement and beat out inflation. If you were to put your $100,000 inheritance in a cabinet today and left it hiding with the rate of inflation as 4% per year, the next year your $100,000 would only be able to buy $96,000 worth of goods. Also, it is important to diversify your inheritance in different investment choices, such as stocks, bonds, and mutual funds as well as having these spread amongst different industries. International stocks are also a good choice for investment; if domestic stocks are falling in the U.S., they may be rising in other countries. By investing and diversifying your inheritance, you will be able to greatly enjoy your retirement.
The reason to think about investing for retirement is simply to live an easy life after all of your hard work. When retirement comes, having money built up to live off of would a great thing to have. In the old days, people worked for a company for their entire life and when they retired, that company would have a pension provided for them. Nowadays, it is necessary to invest some money every month in order to live comfortably as a r ...