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Six Ways You can Save for Retirement in Your 30’s

If you are in your 30’s or something, then you should have already started saving for your retirement.  If you haven’t started, it’s still not late. You can still start today by keeping aside whatever you can.

And those who have already been saving for their retirement should now revisit their retirement savings strategies. Keep reading to know more about the best ways to save when you are in your 30s.

1. Use a Discount Broker

Discount brokers simply execute the trades, as entailed by law, as well as charges the reduced fees. In this, you will get less specialized advice and intelligence on market movements, although some brokers provide free research. By taking help from a discount broker, you are taking the responsibility for your own financial and investing future.

2. Buy Index Funds

In index funds, there is no guesswork and researches are done, even for new investors. Index funds are stocks that demand to mirror the performance of the given index like the Dow Jones industrial average rather than trying to beat it.

Only a few well-selected index funds, will help you to achieve the global diversification across the virtually in all the sectors. Index funds are always passively managed, hence they have low fees. For example, if you purchase a fund that can mirror the Dow, your fund will either gains or loses copying to Dow gains or loses as long as you hold the funds.

3. Buy Exchange-Traded Funds

Exchange-traded funds are funds can be traded on the exchanges, just like the way stocks are purchased and sold. Unlike the mutual funds, it enables its buyers to buy or sell the funds in shares during the trading hours.

ETFs are also a great way to purchase index funds since they enable their investors to purchase in much smaller gains than what is required to purchase into the traditional mutual fund. And contrary to traditional funds, it offers more flexibility of selling a portion whenever it is needed.

4. Use Dollar-Cost Averaging

Now that you have opened an account with the discount broker, you will have to notice when and how to shift the money into an index fund. Dollar-cost averaging is a strategy that enables you to roll with the ebb and flow of the stock-market profit and corrections.

By investing a fixed amount of money over a time on a regular basis irrespective of the stock prices, you can avoid the pitfalls of trying to time- the market. It’s a monumental task for those with the capital, time, and expertise. Dollar-cost averaging does not demand any of those attributes.

If you invest, say, $200 in your index fund on every 15th of each month, you will, on an average, purchase more shares when it is cheaper and fewer when it is more expensive, which should be your goal in the first place.

5. Save Incrementally With Acorns

Acorns are one such amazing app that does its job in the background to assist you in saving and investing for your retirement with nothing more than just spare changes.

The app links to your credit cards and debit card and rounds up all your transactions to the next dollar. Your spare change is then diverted directly into the diversified portfolio of your choice. Acorns recommend its portfolio templates based up on your risk tolerance. Every portfolio is diversified with a mix of small and large emerging real estate stocks, and corporate or government bonds.

So if you spend $1.40, Acorns makes it a round figure to $2 and adds 60 cents to your portfolio. Acorns do not charge minimum deposit requirement or take any commission for trades and rebalancing.

6. Open a Roth IRA

The majority of Americans rely on the employer-based 401k’s for their retirement plans. However, Roth IRAs is a great alternative retirement vehicle or supplementary, if your boss matches funds in the 401k, “for people in their 30s”.

Like 401k’s and traditional IRA’s, Roth IRA’s enables the account holders to save for the retirement along with tax benefits. Roth IRA’s shelter the after-tax money from further taxation, both when it grows and when it’s harvested.

Roth IRA’s come with certain great benefits, the biggest of all is you can withdraw money from it without incurring any penalty.

If Roth IRA is best for you, chances are, that you can place through your discount broker.

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