what's the best way to start a retirement fund, stabilize my future?

Question

I'm 32 years old i never invested nor have a clue on how to build stock,bond or future retirement, need all the help possible with little as money possible a step in the right direction please.

which way is the easiest? where do i go to... im trying to stabilze my future for me and my family, i have NO clue how to begin a retirement plan, ira's, 401k or just saving? Help need direction and guidance please.

Answer 1

There are two simple ways. The first is to participate in a 401K plan at work.

The second way is to open up a Roth IRA. Your money going in will have been taxed, but the money going out won't be. our max limit is $4,000 a year (the begining for a fiscal year for any IRA is April 15), but will increase depending on the year. Then you buy some index such as the SP 500 (covers large corporations), SP 400 (large but not very large companies), Russell 2000 (covers stocks in small but growing businesses), or the Wilshire 5,000 (covers all American stocks in major markets). You can do this through any mutual fund company or even online.

There are also a new form of mutual fund that you can put in your Roth IRA that's called by several names such as a targeted fund or a lifestyle fund. It will looks like Target2050 with 2050 being the closest date closen for retirement. As you get closer to the date, the percentage of new money you put in shifts more towards bonds than stocks. If you want to be more agressive, you could pick Target2060 instead which would hold off on the percentage of bond purchases.

With a Roth IRA, there is no required take out date or minimum take out. The required date to take money out of a standard IRA is 72 1/2 years old.

If you are being offered a mutual fund though, track it by the SP 500. That's the benchmark when comparing mutual funds. Only 20% of the mutual funds have beat the SP 500 over the long haul. Some mutual funds will track (why they are called trackers) the SP 500, but charge you more than if you just held the tracking ETF (SPY) or the index itself.

Do not chase money. Investments go up and investments go down. If you are chasing an investment going up, you might be buying at the top. You probably are now seeing a bunch of for sale signs popping up where people are trying to unload homes they bought. hose people bought at the top and that's going to cost them big time if the next housing boom is 20 years away where they could have sold at a profit. It's a lot easier to get out of the stock market though and the daily and monthly swings are normal so don't panic.

Answer 2

One of the most common retirement plans is the 401 K. In a 401 K, some amount is deducted monthly from your pay check. The money is tax deferred and so you do not pay taxes on the amount invested. Usually there are various investment choices like mutual funds, stocks, bonds etc. In some cases, the employer will match the employee’s contribution to the account, though these instances are decreasing. The next option is IRAs. IRA denotes the individual retirement account and can substitute or complement a 401 K. There are 3 varieties of IRAs available: Roth IRAs, Traditional IRAs and Simple IRAs.