There are quite a few reasons that people choose to invest. They could be investing as a hobby, to meet a goal – such as paying for their children’s education, or even just for their ego. All of these are decent reasons. However, most of us invest for a goal that is long term. Retirement.

Planning for retirement as an idea involves quite a few moving parts. They include travel, healthcare, living arrangements, and insurance budgeting. Also, taxes can play a major role. How about investing though? Here is a look at some of the basics when it comes to investing for retirement.

Foreign Currency

You might be tired of hearing the same advice regarding diversifying your investments. It seems like most financial experts can go on and on about it. However, there are a few ways that you can stray from that tired old advice. Have you thought about trading in foreign currencies, like the Iraqi Dinar? This isn’t limited to only those people who have massive amounts of money. Now, it’s easy even for your average Joe to invest in.


There are mainly three different kinds or types of investments. These are also known as asset classes. These are cash, bonds, and stocks. If you are investing with the goal of retiring one day, your accounts should probably have a mix of all three.

You can make your investments in bonds and stocks in a couple of ways. You can either buy them through a mutual fund or you can purchase them individually. Mutual funds are just a collection of bonds, stocks, and/or cash equivalents.


It is quite easy for retirees to underestimate what they will have to pay for taxes when they retire. It’s natural to assume that things like taxes on real estate will have to continue to be paid, but there will also be taxes on things like income from Social Security and any income generated by investments, and this does include 410(k) and IRA holdings.

For this reason, it can only be a good thing to plan ahead. For example, one of the ways that you can lower taxes in retirement is to not take the income from Social Security until you are 65 or older. This will also get you a higher monthly payout as an added bonus. You might also consider taking advantage of things like Roth IRA conversions while you are still working. These are things that will allow you to be more tax efficient in retirement.

Passive Income

Most retirees have at least a base income from their Social Security. Some people might also have a pension from their place of employment that they can fall back on. The rest will need to invest in things that will give them a steady stream of income. This might be things like real estate funds, bonds, and dividend stocks. This might mean that you need to make a large change in the way that you think about investing.

Avoid Fads

Every so often, the stock market has been known to nose dive. This is where people can learn from history. Typically, those nose dives will be related to a single type of investment that a massive number of investors have decided will be their gold mine. These investments have included things like dot-com stocks, housing, and here lately, gold. Try to avoid these fad investments, especially if you are using retirement funds to invest.


Diversifying your portfolio can be incredibly important. You should never sink all of your money into a single investment. This is because if that investment tanks, you could lose all of your money. Instead, you should balance your high-risk investments with some low-risk options – like bonds or annuities. This will ensure that you always have something to fall back on if the stock market crashes or we have another recession.

Remember that you will be retired for many years. Investing and planning for your retirement are not activities that are mutually exclusive. In fact, these things need to work cohesively. If you have a portfolio that is well-balanced, this can be done with ease.


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