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6 Comments
Its really nice take on how people actually can spend their pension money on investments which they don’t understand. It is more critical actually to play safe in retirement and look for developing other income streams which are more certain and less riskier in nature.
It’s not wrong to invest in stocks after you retire BUT make sure you that you have all the knowledge about it. It’s so hard to take a risk, investing in stock that you don’t know it’s totally wrong.
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Absolutely, if you know about stocks, go for it even if you are retired and if you are new to this world, it is better to ignore it completely and find other safer alternatives.
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I think index funds can still be great after retirement and maybe a few established companies that pay a nice dividend. Great article!
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Index fund can be a great option however, risk becomes great when pensioners actually attempt to pick and choose individual stocks in search of higher returns. Again its the safety which has to be the guiding principal in retirement investment.
The problem with NOT investing in stocks in retirement is that retirement is lasting much longer than it used to. Thirty years is now realistic for a lot of people.
So you need to invest in assets that will grow over that kind of time frame, and stocks are the best bet.
The only way to secure an income in retirement is to buy an annuity, but with interest rates at historic lows, these offer very poor value, especially to younger retirees.
The best way to end up poor over a long retirement is to put too much money into cash and bonds. It’s great to keep a year or two’s income in cash, but after that, stick with stocks.
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