Today, You Have the Tools to Manage Your Own Money for Low-Cost
In the Old World, Before the Internet
Information about investment funds, fees, and performance was scarce and hard to find. In addition, buying shares in stocks was expensive.
K.C. Grainger, a veteran broker now based in Montreal, said the average commission in the late 1980s was $45 dollars.(Source: Business Insider)
Today, Thanks to the Internet, Information is at Your Fingertips
You can use Google Finance, Morningstar, and a dozen other sites to research potential investments.
And trading commissions have fallen to under $5 dollars at most brokerages. Robinhood, a new stock trading app, charges $0 dollars to execute a trade.
With Better Access to Information and Low-Transaction Costs, There is a Trade-Off
How do you know what information to trust and how do you guard yourself against bad investment behavior?
Most importantly, how can you set yourself up for investment success and ensure you have enough money for retirement?
First, let's invert the question
What Actions Can I Take to Ensure I Will not Have Enough Money in Retirement?
In Order to Win in Retirement, You Need to do the Opposite of the Actions Above
Let's see how with the three-bucket strategy
(1) How toSave Money
These tools are great for helping you save money. Give them a look.
(2) Low-CostWell Diversified
This could be your 401k, pension, IRA, or any type of retirement vehicle. It should be low-cost and well diversified.
This is money, not in your retirement account, that you can play with, speculate with.
Depending on your investing goals, this could be as little as 5% of your investment capital or up to 50% depending on your age and risk tolerance.