Investment advice?
November 7, 2009 by
Filed under investment advice
I am looking to invest 30,000. I am 40 ish and will not need the money till retirement so I am looking for a SAFE investment…maybe an Annuity?? I already have IRA’s. Any suggestions??
If you are in the US, the safest investments are CD’s. Both the principal and income are guaranteed.
With fixed annuities, the real interest rate is about 4%.
Since you have about 25 years to go, I suggest investing in a mutual fund that tracks the S & P 500. S & P are constantly updating their mix of stocks, so you will be owning the top large companies. You might get an annual return, over the long run, of about 10% per year.
With your time frame, I would recommend a broad market mutual fund. There is obviously more risk than in CDs or bonds. But over the 20 plus years of your investment, I think the market risk is less than the very real risk of inflation. The mutual funds also provide reasonable growth prospects. Significantly more than a CD or bond.
Take a look at Vanguard. Two that I would suggest are VTSMX and VGTSX. VTSMX is a total US stock market index fund. VGTSX is an international fund. You will have the whole world covered with those two.
Alan,
You are right on the money with an annuity! Tax deferral is a wonderful thing and thats exactly what you get with an annuity.
I would, however, take it one step further and examine Variable Annuities.
A Variable Annuity is also tax deferred and designed for retirement but offers you the opportunity to select various mutual funds inside the annuity.
You have a very long time frame if you are seeking retirement after 60 or so, making mutual funds a more than appropriate choice for you.
If you are risk adverse there are even Variable Annuities that offer Guarantees.
These guarantees protect the death benefit to your beneficiaries. Others offer a fixed retirement income to you even if the stock market makes all your money disappear.
you should be in 80% in stocks, 20% in bonds
BIZBAG SECURITY ANALYSIS
Frank J Kelly Jr
analysts
SAFEST us t-bILLS although the standard is mutual funds bonds or annuities, if you want the money to grow you will have to water it. I would say that options on stocks if following a strick bussiness plan will be the highest return and a known fix gamble. Put half in bonds or bills and check out chicago one best option traders I know.
Av