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Growth Investments
Learning Center • financial tips • cash reserves • insurance • savings accounts • growth investments • taxes • retirement • estate planning  |
In addition to your guaranteed savings, you need growth investments for your retirement. If your employer has a retirement plan, start by investing in it. If he will match part of your contribution to the plan, be sure to contribute enough to get his matching contribution. That is a free gift.
Good long-term investments have traditionally averaged 10% to 12% per year; therefore, your investment portfolio should average 10% to 12% per year or more. Invest in good mutual funds in your retirement account that average 10% to 12% a year or more. There are over 100 of them. There should be one or two in your retirement account. If your employer doesn’t offer a retirement plan, you can set up your own IRA and contribute to it from every paycheck. Your contribution each year will be tax deductible just like the company plan.
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A mutual fund has flexibility, as you can transfer from one fund to another within your fund's family, without any cost. This is important because your investment objectives or the economy may change.
Complete history and current information on every fund is easily available. The fund company provides all that and more in the prospectus, in sales materials available from the company, and on its website. Also, Morningstar provides complete information, in writing, on all mutual funds at your library and on its website, www.morningstar.net.
Performance figures are published on a daily basis by the fund, by Morningstar, and in most big city newspapers.
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Book: MONEY Changes Everything, by Erlend Peterson, CFP
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