Should IRAs in mutual funds remain in mutual funds during the retirement years, or placed in another type of investment or savings?
2007-02-06 03:14:01 · 7 answers · asked by Michael P 1 in Business & Finance ➔ Investing
When you are in your 20's you should have 80-100% of your IRA in stock mutual funds and 0-20% in bond mutual funds. As you get older, you should slowly shift more of your money into the bond funds, a little each year. By retirement, you should have 30-60% in stock funds and 40-70% in bond funds and money market funds. If you invest in a Target Retirement fund at Vanguard, they will slowly make this change for you automatically. Fidelity and T Rowe Price have similar funds.
2007-02-06 03:37:35 · answer #1 · answered by Anonymous · 0⤊ 0⤋
It would be best to keep 60% in a stock funds ans 40 % in bonds or money market fund . Age 62 would be a good age.or go into a target fund. See what year you want to retire ans invest tin a fund that has that year or close to that yr as the target. They will adjust he type of investment they make as it gets closer to the retirement date. You will not have to do anything at all. Keep it in an IRA until you start taking monthly income.
2007-02-06 04:30:30 · answer #2 · answered by ? 6 · 0⤊ 0⤋
There are gradients of safety in investments and mutual funds are probably somewhere in the middle with hedge funds being very risky and CD's at the other end of the spectrum. So, safety is determined by the things in which the mutual fund invests. You can find riskier, chance taking mutual funds. And it's always a process of balancing risk and return. If you have enough assets it's general advisable to have some (maybe the bulk) invested in safer stuff and some in riskier places. All mutual funds are rated as to their degree of risk and those are generally reliable.
2007-02-06 03:23:50 · answer #3 · answered by DelK 7 · 0⤊ 0⤋
Mutual funds cover all area. Bonds, Stocks, combinations of both, foreign, domestic, etc. You can change the type of mutual fund but need never get out regardless of age. Etfs even cover agricultural futures, currencies, etc. Never a need for a big move like pulling out. Safe is such a misued term. At 65 very likely to make 85. 20 yrs for taxes & inflation to hit your nest egg. Don't misuse "safe" when you know money is a bank is not safe against those 2 enemies at all.
2007-02-06 05:24:01 · answer #4 · answered by vegas_iwish 5 · 0⤊ 0⤋
I'd leave them in mutual funds forever. I might just change the type of mutual fund as I grow older (probably transition a little bit at a time into conservative mutual funds).
Just be careful about being too conservative (that's just as bad as being too aggressive).
2007-02-06 03:58:56 · answer #5 · answered by derek 4 · 0⤊ 0⤋
Your portfolio allocation is extremely important at all stages of your life but even more so as you get closer to retirement. The purpose of a retirement portfolio is to replace a certain percentage of your pre-retirement income that you will no longer be receiving. As you near retirement you need to begin re-allocating your portfolio away from assets designed for wealth accumulation (equity assets) and more toward wealth preservation and income producing assets (bonds). At what age you should begin this shift in portfolio allocation and by how much is different for every individual so my suggestion is for you to sit down with a qualified financial advisor who can structure an allocation specifically designed for you. Your advisor will need to consider a lot of factors such as: what age you plan on retireing, the amount of income you will need to replace, your risk profile, how many years you estimate you will live in retirement etc.......but most importantly the age at which you should begin this process comes down to how successful you were at the wealth accumulation stage....the earlier in life you can amass a portfolio large enough to provide you with the income you need in retirement the earlier you can begin reducing your risk by re-allocating your portfolio away from risky assets (equity) and into less risky assets (bonds).
2007-02-06 03:50:20 · answer #6 · answered by SmittyJ 3 · 0⤊ 0⤋
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2016-11-25 20:11:33 · answer #7 · answered by ? 4 · 0⤊ 0⤋