Multiply your nest egg with these five strategies

Here’s a cliffhanger in which you don’t want to play a starring role. A Wells Fargo study released in October 2012 predicts more than one-third of middle-class Baby Boomers will eventually “teeter on the edge of a retirement cliff.”

The study also indicates around one-third of the nation’s middle class citizens believe their standard of living will be slashed in half by the time they retire. Statistically, retirees will be facing a vast shortfall in income. In reality, a lot of septuagenarians will shuffle through menial jobs in order to put food on the table.

The good news for Baby Boomers is that there is still time to turn this scenario around with a household budget. Youve still got a decade or two to incubate that nest egg and avoid an impoverished future, with these five strategies:

1) Downsize your lifestyle. Frugality is a mindset. A little denial is good for the soul. Start keeping track of your expenses. Often people are shocked to see the numbers behind their spending patterns, but knowledge is power. Calculate the cost of that daily latte, then weigh it against your retirement dreams. You might decide Starbucks can take a backseat to what you want in the future!

2) Don’t gamble on risky investments. These may or may not boost your portfolio, but high-yield investments often pack a lot of risk. Make sure you can afford to gamble before you crack your nest egg.

3) Shop investment firms. We all know that in the wake of the financial meltdown in 2008, having a shiny nameplate and lots of picture-glass windows do not necessarily correlate with a quality investment firm. Look at the numbers, not the pizazz.

4) Balance your portfolio. This move is particularly important for those approaching retirement. Don’t put your financial investments on autopilot. On the other hand, don’t shift funds around like you’re playing a game of Monopoly. Your retirement plan is more like a large ship that doesnt respond well to quick shifts in strategy.

5) Control your impulses. We all know by now that the investment community tends to attract adrenaline junkies. Keep the investment ship steady, and don’t pay too much attention to daily stock-market numbers. If you want the thrill of watching peaks and dips in the stock market, give yourself a small stash of money to play with. Have a little fun, but don’t gamble with your entire portfolio.

This entry was posted on Tuesday, July 16th, 2013 at 9:02 am and is filed under Blog. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response. or trackback from your own site.

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