What is most important is not the dollar amount but the purchasing power of the money that you save. In other words, what your savings will buy when you retire. Expect inflation to destroy the purchasing power of your savings almost as fast as you build wealth, depending on your asset allocation. Continue reading Investing for Retirement: Compounding, Inflation & Real Returns
Your first goal is to not spend more than you earn. In particular, do not carry credit card debt month to month. There is no point in trying to figure out how to maximize return for a given level of risk if you are in debt beyond your home mortgage (~4%) and low interest (1-2%) car loans. The reason for this is that you likely are spending more on interest for your loans and, particularly, credit card debt than you ever would recoup by investing an equivalent amount minus fees, taxes, and your high interest debt. Continue reading Investing for Retirement: Building Your Net Worth by Budgeting, Saving & Investing
Contents Overview Defining Your Investment Objectives Building Your Net Worth by Budgeting, Saving & Investing Compounding, Inflation & Real Returns Controlling the Costs of Your Investing Risk, Return & Time Market Risk Other Types of Risk Longevity & Mortality Risk Health Risk Event Risk Tax & Policy Risk Investment Return Time Recalling the Lessons of History Predicting the Future Financial Market Efficiency The Efficient Market … Continue reading Investing for Retirement: Table of Contents
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