Best way to invest for retirement

The Best Way To Invest For Retirement

The Best Way To Invest For Retirement

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Creating a retirement plan can be one of the most challenging things you can overcome as a hard-working individual since it takes a lot of consideration to formulate the best way to invest for retirement. 

So plenty of us just avoid the task, and let ourselves believe we’ll just do it another day – but we never do.

There is also the added factor in which we just don’t want to be thinking about our retirement when we are in our 30’s or 40’s as it’s sort of a depressing reality to face this early on in our life.

But the bottom line is, we’re all going to get old someday so it’s best to start planning and executing sooner rather than later so we can remain financially stable for the rest of our life.

Since investing for retirement is a long-term process, you have many different options available to you when it comes to accumulating money to ensure that you can spend as many days as you doing what you want when you retire.

These retirement options can include things like IRA’s, 401ks & HSAs, as well as ways you can invest the money in these accounts to further develop your capital like mutual funds, ETFs, REITs, stocks, and dividend investments.

In this article, we’ll be giving you some insight as to what these are so you’re more aware of your options and have the opportunity to explore them further to set up your own plan.

So don’t be discouraged, and please keep on reading to find out how you can invest in your future.

It’s never too late!

For more information in regards to Mutual Funds and ETFs, click on the link to the SEC guide.

What are the different types of retirement accounts to invest in?

We want to go over some of the options you have when it comes to increasing your personal capital so that you can have the retirement you want.

IRA’s (Individual Retirement Accounts)

Traditionally, IRA’s allow you to have significant tax breaks whilst you save for your future retirement, meaning that you can earn the money by working a regular day job, contributing to this plan with pre-tax dollars.

The IRA itself can grow without you needing to pay a cent of tax on it until you withdraw the money from the account once you retire – at that point it is taxable – earlier withdraws will mean that you may have to pay extra on top.

One of the other great things about IRA’s is that you can invest the money how you want, whether that’s in stocks, bonds, real estate – it’s really up to you.

IRA’s can be one of the most confusing retirement accounts you can put your money into since there are a lot of different types that offer different pros and cons. Click the following link to learn more about what an IRA is and how they work.

For more information in regards to IRAs, click on the link to the SEC guide.

Who offers the best IRA accounts?

Depending on your needs I have three specific recommendations. 

Our #1 rated Robo advisor for both IRA and traditional brokerage investing is M1 Finance. It’s free to open an account, you can use their Robo advisory services or actively invest in stocks and funds on your own. They also offer all three types of IRAs for you to start. Accounts are free to open and you can start investing with as little as $100. Check out M1 Finance below.

#1 Rated Robo Advisor & Dynamic Portfolio Rebalancing

#1 Rated Robo Advisor & Dynamic Portfolio Rebalancing

The M1 Finance’s brokerage, retirement account and overall technology are simply amazing. They offer dynamic re-balancing, full customization and even some pre-built portfolio options called expert pies. M1 Finance is a strong recommendation for your automated investment and retirement needs. Try them today with only as little as $100 to start investing.

M1 Finance custom pies

If you’re looking for a completely automated Robo Advisor, for an IRA retirement investment account only, then our #1 rated automated retirement Robo Advisor platform choice is Acorns. Their platform takes spare change from your everyday spending and automatically invests it for you. They do charge a small monthly management fee for their services. Learn more about Acorns below.

#1 Rated For Automated Funding Of Investments

#1 Rated For Automated Funding Of Investments

Automate your retirement investing through your spare change and intelligent Robo advisor services. Setting up an account takes less than 5 minutes. They now offer no-fee checking as well. If you want to put your spare change to work to help grow that retirement nest egg, there is no better product on the market than Acorns.

Acorns App Phone 1

If you have $100,000 to invest and you’re looking for a hybrid of Robo Advisor and traditionally managed accounts, at Ultra-low costs, then you have to look into Personal Capital. Check them out below.

#1 Rated For Net Worth Analysis & Managed Investments

Hands down, Personal Capital is the best platform for you to calculate your net worth. Personal Capital also fills in all the gaps I tend to find with Mint as well. They also have a very robust portfolio management offering that is a hybrid of a managed and Robo advisor. The best part of all is that their net worth and portfolio projection tools are completely free to use. 

Personal Capital Screen Views Phone

401ks

Perhaps one of the most common retirement plans available.

A 401(k) is a tax-advantaged plan (similar to an IRA) where the employee contributes to the plan with pre-tax wages, thus the contributions made are not seen to be taxable.

The plan allows this money to grow tax-free until they are withdrawn after retirement – though generally, you will see no additional fees, if withdrawn before the age of 60, you might be hit with them, however.

For more information in regards to 401ks, click on the link to the FINRA guide.

HSAs (Health Savings Accounts)

Though HSA’s does not directly benefit your retirement (the money here won’t pay for those fancy cruises you have in mind) it will however cover you when it comes to paying off any medical bills which may arise in the future.

This account can be paid into by the employee or/and the employer with a maximum amount being allowed to be paid into it each year.

The money accumulated in this account is not exclusively used for emergency medical care, it can be used for dental and vision care as well as prescription medication.

To learn more about HSA accounts please watch my detailed YouTube video below and also click the link to read my in-depth article on using an HSA for retirement.

Learn more about Health Savings Account (HSA), click the link to the HealthCare.gov website for more information.

Can I open an HSA on my own?

Yes, you can open a health savings account (HSA) even if your employer doesn’t offer one. You can only make contributions if you are covered by an HSA-qualified health plan first. 

If you happen to meet the requirements, our number one recommended HSA provider is Lively. They offer HSAs for individuals or families. Please check them out below if you’re looking to get started and learn more about HSA options with Lively.

#1 Rated For Health Savings Accounts

#1 Rated For Health Savings Accounts

100% free health savings accounts for individual and families. Their modern HSA platform helps you maximize your health care savings! Lively helps people prepare for tomorrow by making smart decisions about finances and healthcare today. Whether you’re an employer or an individual, Lively offers a simple to use HSA platform for you. Try Lively today.

Lively App Phone

What are the Investment options in these retirement accounts?

As mentioned, the money in these accounts can be invested to help further increase the money you have sitting in there, to help better your retirement – making the money you worked hard for, continue to work for you for years to come.

This includes mutual funds, ETFs, REITs, stocks, and dividend investments.

Mutual funds

Mutual funds are a type of investment made up of a pool of money that has been collected from many other investors – this money is then used to invest in things like stocks and bonds as a collective.

This large portfolio is typically managed by a professional manager whose job it is to turn these assets into capital gains or further income for the original investors – depending on what the original objectives were with the mutual fund in the first place.

ETFs

ETFs are similar to mutual funds although it costs far less for an entry position, this could be as little as one share in most cases and typically the shares within the ETF are traded through the day between investors like a stock would be.

Since ETFs are passively managed, unlike mutual funds where it is someone’s full-time job to increase the capital of the overall portfolio, ETFs gain much less capital over the years – though they offer tax advantages to investors like IRA’s and 401ks do.

REITs

REITs or real estate investment trust is a company that owns, operates, or finances real estate projects – these companies allow people the opportunity to invest invaluable real estate for the purpose of capital gains – as well as the added benefit of helping communities grow and thrive.

REITs are a great idea for anyone who is interested in the idea of real estate and is looking to help their local communities grow as much as their retirement fund will.

Stocks

Stocks are one of the most common investments one can make with their money, and are fairly safe if you put your money into the right place – you COULD take risks with this based on the companies you choose to invest in, but we’d advise against this for a retirement investment.

Dividend investments

Dividends are payments one receives from a corporation if they are a shareholder – when you own a stock that pays dividends, you are receiving a share of the company profits.

Dividends provide a healthy way of receiving steady income into your retirement accounts, allowing you to further grow your portfolio without too much effort.

To learn more please click the link to my detailed article on dividend investing and watch my YouTube video below.

Rental property is a great form of passive income in retirement

Renting property is one of the best ways you can achieve your retirement goals as you are able to get a steady income each month, depending on how many properties you are renting out.

Cash Flow Real Estate Checklist

Cash Flow Real Estate Checklist Phone

Cash Flow Positive Real Estate is simply one of the best ways to grow your net worth all while collecting that coveted & amazing passive income every month. This checklist walks you through the simple steps that you can use today to start your cash flow real estate journey. 

Renting out your property can be a breeze with services like VRBO, analyzing rental property investments is just as simple as using an app, thanks to DealCheck, and managing it with Rentredi.

#1 Rated Rental Property Booking Platform

There is no other property rental platform that offers the flexibility, security, service and potential profitability as Vrbo. Everything you need to list your home is in one place. Write a description, choose your settings, add photos and set your price, they guide you step by step. Get extra peace of mind with $1M primary liability coverage for all online bookings.

Vrbo product image tp Phone

#1 Rated Investment Real Estate Analysis Software

This is my go-to real estate analysis tool when I’m searching for cash flow positive rental properties, BRRRRs, flips or other types of real estate investments. Within seconds I have the data available to make the most informative real estate investing decisions. The best part about Deackcheck is that they offer most of this within their free tier.  Try it today. 

dealcheck home screenshot Phone

#1 Rated Property Management Software

If you’re a landlord and you’re looking for a simple software solution to help manage all of your property management needs, then you must try Rentredi. From receiving payments, screening tenants, maintenance, listing properties and so much more, this platform has it all. If you’re looking to grow and maximize your cash flow potential then you have to try Rentredi.

rentredi portal Phone

Summary

There are many ways you can invest in your retirement future, and if you haven’t started yet then believe us, it is not too late to start right now!

FREE Retirement Checklist

Retirement Checklist Phone

Here’s a nice simple checklist for your retirement planning. I put together this simple and essential retirement checklist with the goal of quickly providing you the initial information you need to start formulating your retirement savings plans. 

We have laid many great ways you can go about achieving your financial retirement goals in this article, but we have merely scratched the service when it comes to investment opportunities.

If any of the ones we mentioned above sound like your thing, then we encourage you to dig a little deeper and find out how you can get started when it comes to securing a future, for your future self.

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Frank Makrides

Frank Makrides

Is a former financial technology industry executive, licensed realtor, real estate investor, an award-winning speaker, has been published, holds multiple patents and is passionate about all things personal finance and entrepreneurship. He is also a proud husband and father of 2 amazing children.

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