Earlier this week, I started looking at an article from CNN Money about rescuing your retirement. The first step was to honestly evaluate where you are right now, so that you have a place to work forward from. Today, we will move on to Step 2, which is all about your portfolio.
Look at your retirement account investment portfolio
Your retirement account is really an investment portfolio. Your gains — and even your contributions — can be tax advantaged. This is a nice perk of having a retirement account. And now is not the time to pull out. Instead, you should look at your portfolio and make sure you have fundamentally sound investments — and a mix.
CNN Money offers this look at retirement account portfolio allocation:
your savings in stocks when you're in your forties, 70% in your fifties
and 50% to 60% in your sixties, with the rest in bonds and stable-value
funds. With stocks now at their cheapest levels in nearly two decades,
those allocations give you a good shot at regrowing your portfolio
going forward.
It's still a good idea to avoid dumping all of your stocks. After all, they are inexpensive right now. However, don't count on them to completely rescue your retirement, and realize that they are a long-term strategy — something that gains over decades. But you may have to re-evaluate which stocks you keep.
image credit: Tracy O via Flickr
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