We all instinctively approach most decision making as a simple process of calculating risk and reward. When it comes to building a diversified portfolio and making a long-term financial plan for retirement, the individual choices that must be made – both initially and on an ongoing basis – carry enough weight that their potential for risk or reward must be considered carefully.
For many people, thinking about a comfortable retirement simply means contemplating enjoyable and leisurely ways of spending time during these “golden years” of life. What some people may not take into account, however, is the impact that taxation can have on retirement savings, investment accounts, and withdrawals for living expenses or spur-of-the-moment purchases.
Many investors opt to put a portion of their earnings into a Roth IRA to benefit from the potential tax-deferred earnings of such an account as well as tax-free withdrawals during retirement, both made possible because Roth IRAs are funded by after-tax dollars. Thanks to recent tax law changes, there may be a way for you to access the benefits of a Roth IRA even with a generous salary.
For many investors, the concept of owning residential or commercial real estate as a means of growing and diversifying their portfolios seems like a solid strategy. However, the cost of outright real estate ownership coupled with the time and attention needed to maintain it can put these investments out of reach for much of the general populace.
If you are like most professionals, you’ve most likely worked for more than one employer during the course of your career. While “job-hopping” was once a frowned-upon activity, these days, it is neither uncommon nor the subject of much stigma to be employed by many different firms throughout your working years.