Even though the economy has made major changes for the better since the great recession of 2008, there are still many retirement accounts that haven’t recovered from the massive beating they took during this time. If you are looking for some great 2016 investment tips to get back on the horse and fund those golden years so they can truly be golden, and not fools gold, then read on to learn more about the incredible options that are available.
Tip #1: Prepare for Some Volatility
While the markets have definitely been going in the right direction for some time, there are still several economic indicators that have professional economists worried, or at least nervous. After so many months in a row of strong job growth and markets trending upwards, it’s only natural that there are going to be some corrections and bumps in the road. Don’t get stuck looking at the short term in 2016 and 2017, make sure you’re in it for the long run and be prepared for a rocky start to this ride.
Tip #2: Make a Budget and Stick with It
While you might be thinking why would a budget fall under 2016 investment tips, the truth is that once things get rocky it is always tempting to raid the retirement account or to go on a little bit of a splurge to comfort your nerves. The key here is to make a budget with investment in mind. This means more than putting 10% into a 401(k); it also means putting 5 to 10% of every paycheck aside in cash that you don’t touch in case of emergency. If you can do more on both counts that is great, but set the budget and stick with it even going so far as to get a second part-time job before cutting down on your emergency savings and investment.
Tip #3: Consider Investing in Yourself
Although most investment advice looks specifically at stocks, commodities, and other moving market trends based on current economic reports, perhaps the best investment you can make would be the commitment to invest in yourself. Read books about finance, budgeting, and running your own business. Learn a hobby you enjoy and find a way to make money on the side with that. Consider a part-time job that teaches you new skills. Lose those extra 30 pounds that could cause health problems in the near future. A long-term investment in yourself will affect every other part of your portfolio.
Tip #4: Safety Net First, Risk Later
No matter what your age, there is a lot of wisdom in the idea of making sure a good chunk of your savings are in something safe that cannot lose value. Among the 2016-2017 investment tips out there, this might be one of the most important especially when considering how much volatility most people believe will be up ahead in the financial markets. Build that safety net first and go for riskier investments with higher upside later.