if I retire in 25 years and I have 20k in savings how could I invest it?

Question

I want to live comfortably by the time I retire do i invest? how do I build my nest egg the most safely?

Answer 1

Assuming the $20K is invested for 25 years with:

-- 3% annual inflation rate
-- 10% annual return on your money (after taxes)

Then, 25 years from now, inflation means you'd need about $41K to buy the same things that $20K buys today, but you'd have about $216K in savings. In essence, the equivalent of trying to live off a little over $100K in savings today. I doubt you could retire "comfortably" on that.

You'll probably need to be saving more over the next 25 years. How much depends on what you consider "comfortable". For example, if you were to add $5000 to saving each year, in 25 years you'd have about the equivalent spending power of about $338K today.

Answer 2

You have 20k now?
Check into Zero Coupon Municipal Bonds.
For the 20k you can buy a bond that matures in 20-25 years with a GUARANTEED return. In that time period it would be worth approx. $40-$45 depending on the investment. And the best part, you don't pay federal tax on the earning, and not in some states either.
Check an investment counselor for details as you can't just purchase them yourself.
I discovered these by a lucky accident and am using them for retirement, buying so they're come due semi-annually.


ZERO coupon municiple bonds are not the same as municiple bonds and the interest is NOT taxed.

Answer 3

To turn 20K into living comfortably in 25 years, you will need to take a few risks in your investment options. Of course the bigger the risk, the bigger the loss or gain. If you want to invest safely don't expect miracle's. Check with a broker, insurance agent, or investment adviser. Look at variable universal life insurance products, some of these have a guaranteed rate of return making it a less risky investment. Whom ever you choose to talk with about this make sure you read the prospectus of any fund before investing and discuss your total risk tolerance to establish what product will best suit your needs. Best wishes.




Muni Bonds are tax "deferred" not tax free. You pay tax on the interest earned when they mature.

Answer 4

For you i believe you should invest it in Mutual Funds, they are the best method of investing in the markets if you arent familiar with the markets and investing or Trading. If you want you should also learn to trade or invest in shares or Forex. I am personally a currency trader and doing very well for myself. so i would personally be trading that money. Juat to show you what is possible, In forex i am work on making about 60-80% per year, which is quite high. Shares are a bit more stable and with 25,000 you would be doing fine with 30% per year. Warning though, LEARN LEARN LEARN before you spend a dollar. Mutual funds in the meantime. i learned for 2 years before i started live.

Answer 5

As you are looking for long term investment,Isuggest you invest in shares as they provide very high returns.
To learn more on shares and stock trading and how to select the best stocks.Check the website link below.
Hope it helps

http://money-review-site.com/shares.html

Answer 6

Personally I'd buy a small taxi company with that sort of cash.
Get a loan to cover anything else which will pay itself.