What kind of investment portfolio should you have at any given age? As we get older and wiser, so should our investing portfolio. The way you invested in your 20s should not be the same way you invest in your 40s. This article will help break down what your investment portfolio and strategy should look like throughout your lifetime.
Through Your 20s
If you have recently graduated from college than you may have a significant amount of debt from loans you need to pay off. There is no better time to invest! Although student loan debt is concerning, your 20s is the best time to invest your money. Investing in your 20s is valuable because of compound interest. The money invested has more potential to grow over the years through compound interest. The compound interest accumulated over that time makes your 20s the best time to invest. In your 20s you can invest aggressively in the stock market because you have more time to adjust and absorb fluctuating market changes. Seek fast moving stocks and avoid slow-growing assets.
In Your 30s
Now that you have outgrown the childishness of your 20s, it’s time to get serious about investing. Whether you decided to start investing in your 20s or are just beginning in your 30s, you still have time to make great financial gains. During this time in your life, you are still young enough to invest in aggressive stock markets and can now invest more of your yearly income. If you are starting a family or paying a mortgage, investing for your retirement should be at the top of your list. Research retirement plans for yourself and look to maximize that contribution. You still will have about 30 maybe 40 years of work left in you so invest wisely, and you will reap significant financial gains.
Over The Hill
Your 40s should serve as the midpoint of your career. This is the time to buckle down and get serious about your retirement investing. Newly added expenses may have come up along the way from your 30s to your 40s. You may be paying for college funds or a mortgage, but retirement should be more prevalent in your mind.
The 50s and 60s
The closer you get to retirement the more cautious you should be about investing. Investing at this point in your life should be done carefully. Avoid large risks and play it safe to get the most out of your money at this age.