It is Okay to Get Investing Help

When I was in my early Army years after college, I met with a financial advisor. I had no idea why I was meeting with him. At 21, I was not even thinking about life insurance or retirement. I was living in the now. I would say that most folks in their early 20’s were just like me. We wanted a girlfriend. We just wanted to hang out and that was it. Sure, we took our job seriously but retirement was 40 years away.

I did have extra money so I started a retirement plan. It consisted of life insurance and an investment portfolio. It was written within my budget constraints so there was no stress involved. That was important to me. I did not want anything taken out of my checking account that would run me out of money every month. At the time, I did not understand the difference between permanent life insurance and term life insurance. I know one of my friends from high school told me to buy term and invest the rest. Everyone’s investment strategy is different. I chose to get permanent life insurance and had a portfolio of mutual funds.

This was fine. I had something. I was not worried about it. As I got a little older, I realized how important having a retirement strategy was. At 21, I did not know this. Part of the reason I did not know is because my advisor did not educate me as well as he could have.

There is a big difference between term and permanent insurance. They are both true to their names. Term insurance is temporary. It is normally bought for a certain amount of years (10,15,20 or 30) at a fixed payment. At the end of the term, the price goes up tremendously if you want to keep policy. Permanent life insurance normally lasts to age 100 or later. The price is normally fixed the entire life of the policy. It also grows in cash value over time. Each type of insurance has benefits. Work with an advisor to get the best policy fit for your needs.

On the retirement planning side, there are many different portfolio options. There is plenty of variety to choose from. Make sure that you monitor your investments in case your advisor is not. It would stink to have a slight market change and lose 30% of your investment. Almost all investment companies send out monthly or quarterly statements. Review your statement. When advisors help you pick investment futures, they found out what type of investor you are.

People are either conservative,moderate,or aggressive. The conservative wants to make money but does not want a lot of risk. The moderate wants to make more money and take a little more risk. The aggressive investor takes a lot more risk in an attempt to make more money. Everyone is different and there are funds and stocks for all.
The biggest thing that I learned is to start young. It is much easier to build for retirement over 40 years as opposed to 15 years. Instead of spending $60k for an awesome car, spend $20k for a decent car and start investing in your future.