Skepticism About Good Stocks To Invest In For Retirement
Any broker or financial planner who claims to know with certainty the good stocks to invest in for retirement should be approached with caution. Since the stock market is a moving target with unpredictable, wild gyrations not even fortune tellers can predict with guaranteed certainty good stocks to invest in for retirement. Saving for retirement requires sacrifices and it takes a lifetime. If your broker is telling you there is a quick-fix to avoid the lifetime of saving and sacrifice, find a new broker.
Basic Retirement Planning
The secret to finding good stocks to invest in for retirement is to not base all of your investment activity on your brokers’ advice. Your brokers job is to process your investment transaction and give a bit of advice. Most brokers or financial planners have a few favorite stocks that they recommend. You own the results (good or bad) of that investment recommendation. A better approach to finding goods stocks to invest in for retirement is to rely upon yourself; afterall, it’s your hard earned money that’s being invested.
There are good stocks to invest in for retirement, at the moment. Market corrections occur all the time. The volatility of the stock market creates a unique problem; today’s winning stock recommendation may not be the best investment for you over the long run. The key to maintaining a strong stock portfolio is understanding the market so that you can keep your broker advice “in-check”.
Sector Or Company
When you hear about a hot stock, research it before buying it. You may learn that the stock in question may be strong but the sector is a weak one. For example, with the aging of the baby boomers, health care as a sector was attractive. However, with the uncertainty of the Affordable Care Act, the health care sector may not be as attractive as it once was.
Hold Or Fold
Play it safe, never fall in love with a stock or a company; if you do you will be torn on holding or selling if that stock performs poorly. We live in an ever changing world and nothing lasts for ever. Years ago IBM and GE was the hot stock; if you did not hold one or both of those stocks you were missing out. Holding a stock forever is not as good of an investment move anymore. You need to know when to hold ’em and when to fold ’em. If you can avoid clinging to a stock or company you will make better decisions.
Pay As You Go With Dividends
If you will be looking for extra money to pay your bills with, good stocks to invest in for retirement can be those stocks that pay above-average dividends. You can receive those dividends direct or have them reinvested. Of course you will be taxed either way on the dividend payment but you would also be taxed on the sale of your stocks if you realized a capital gain. However, the tax rate on dividend income is less than the tax rate on capital gains.
When investing in the stock market your broker or financial planner can be an aid to you if used in the proper way. Confirm their advice before proceeding with a stock purchase, ask questions about why the stock is an advantage for you and learn as much as you can about a stock before investing in it.