Retirement Savings Rule 2: Plan for Your Future Goals and Needs
This is the VOA Special English Economics Report, from voaspecialenglish.com | http Last week, we discussed limiting investment risk in retirement planning. So what are financial planners advising people to invest in? Stocks and bonds are the best known investments and are important to any savings plan. Instruments like savings accounts and certificates of deposit pay a small rate of interest. They carry little risk. Annuities are another savings instrument with low risk. Financial planner Pete D'Arruda says "Worldwide, people can put their money in annuities, which are basically savings accounts offered by insurance companies." But he says it is important to make a decision about an annuity with a good financial planner. He warns that annuity agreements can be complex, and many bad ones are out there. Pete D'Arruda says good planning means placing money into financial securities and accounts that have different risk levels, using asset allocation. "So true asset allocation is having some in stocks, some in bonds, some in mutual funds, but then some in other places with guaranteed income and then safety and liquidity kind of accounts for emergencies." This method of savings follows the old saying you should not "put all your eggs in one basket." But that is not for everyone. Sande Taylor is with the investment company Charles Schwab in south Florida. She advises investors every day. She says many investors have a personal style. There are conservative investors. "A …
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