Sunday, September 1, 2013

Could Trading Be a Viable Option to Plan for Retirement?

Retirement is a fact of life for most working people, because there is going to be a time in your life when you will want to, or have to, leave your position of employment. It used to be traditional for companies to provide suitable pension plans for their employees, so that they had an income that paid them enough to live on in their old age. Also, there was a time when a state pension and other social security benefits were there as a safety net for those people who did not have their own private or company pension provision. However, with cutbacks in social security becoming more severe, coupled with the ever rising cost of living, social security benefits are no longer enough to cover the cost of living, for a lot of people. 

Making Personal Arrangements

The only other option is for people to make their own arrangements to ensure that they have enough money to give them a certain level of financial support, when they do retire. The range of options that are open to those people who are looking to make their own retirement plans can seem a little daunting at first glance, that is why it is important that you speak to a financial advisor who can help you find a financial plan that suits your situation.

Of course, you could simply keep working, and this could help, however, there is going to be a time when, depending on your job, you are going to reach an age where you are no longer able to perform your tasks with the necessary speed and competence. 

Investing In Your Future

When it comes to investing for your retirement, any financial advisor worth his salt is going to advise you to spread your investment across more than one scheme. This is good advice, because if you have all your money in just one scheme, and that scheme tanks, then you are going to lose most, if not all of your investment.

The one financial scheme that most financial advisors will tell you to invest in is stocks, as you can divide your portfolio across a number of different stock options. Stocks have the potential to offer big returns, however, they are also considered to be high risk, so it is important to get options trading education, from your financial advisor. Bonds are also an option; however, although these are very low risk, the payouts are going to be less than you would expect to receive from stocks.

Different financial advisors will give you different advice about how much of a percentage you should invest in stocks and bonds. However, most will advise you to keep your stock investment close to your age, so if you are 35 years old, you should be looking at using 35 percent of your portfolio, so when the time comes to retire, 65 to 70 percent of your portfolio should be invested.

So to summarise, investing in options trading to provide you with an income in your retirement is a risky option, but it is the option that is going to give you the best financial return on your investment. So long as you invest in stocks across a number of companies, then you should avoid losing all of your investment should a financial crisis take place. If you are thinking about investing in stocks in order to provide an income in your retirement, then you need to speak to a financial advisor at the earliest opportunity.

Liam Ball is a finance expert who enjoys blogging about financial topics. He is a regular contributor to a number of finance blogs all over the world.

1 comment:

  1. Could Trading Be a Viable Option to Plan for Retirement? Yes, we can think so. But don't spend a large amount into it. The ever rising cost of living, social security benefits are no longer enough to cover the cost of living. Ask for a good certified financial planner, who can help us in explaining about such plans.


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