Irrespective of your age you can invest at any age with the right investing strategies.
The TwentiesThese are the early years when many people are relatively new to the workforce and are still renters. While some have formed a permanent relationship, many don't have children. Home ownership and family are still in the future.For this group the main financial focus is usually on savings or purchase of equtiesor shares. The first step for many in these age bracket will be to get their spending habits under control and then eliminate it. Only then will they be in a position to start building wealth rather than simply paying for past consumption.Their main challenge will be to decide whether or not to try to supercharge their savings growth by diverting funds into a regular savings plan which they must give a time horizon of at least five years, to give the investments time to perform.
The Thirties
By their 30s, most people are in a permanent relationship, many have children and most have bought a land or are building there house. Of course, some people in their 30s may not have any form of property or investment, this group may decide to try to catch up for lost time by aggressive investing, such as mutual funds or by taking out a margin loan to finance a portfolio of direct share investments.
The Forties
Your financial comfort in your 40s largely depends on how much spending restraint you showed during the previous decade. If you were reasonably disciplined, there is a good chance you will be able to build a house or, alternatively, buy a house in an upscale part of town. However, the 40s is sometimes a financially difficult time for people who have children since they are now costing more than ever, especially if they are at private schools. This group needs to budget carefully. In contrast, those with relatively high incomes, or with few or no family responsibilities, should have the capacity to continue to use gearing to expand their investment portfolio.The alternative will be to divert more money into there pension plan or life insurance.
The Fifties
This is a time for more sustained wealth creation due to higher salaries and fewer family costs (many children by now will be financially independent). For many people in their 50s the main financial challenge is to invest their savings to generate a retirement income, and maximize their age pension. In most cases investments are built around some form of allocated or complying pension. While there is a tendency for older investors to be extremely conservative, especially when the economic outlook is uncertain, higher life expectancy means a very defensive approach probably will result in your money running out.
Rules for us all
But whether you are in this, the fourth age of investing, or any of the other ages, all of us have to deal with the same economic and investment climate. We have to make the same range of crucial financial decisions, based on our assessment of the risks and opportunities that exist.
All investors need to guard against assuming the next five years will generate the same sort of returns as the last. "Expecting the second half of the decade to be just as good as the first half would be naive.”It may be, but there are plenty of reasons to think overall returns won't be as strong. One thing that won't change, however, is the need for most people to adopt a suitable investment strategy and then resist the temptation to chop and change when a particular investment sector generates disappointing returns. As already stressed, it is also crucial to avoid thinking you will be able to make big gains quickly. "Everyone wants to be rich tomorrow, but the risks aren't worth it. Impatience is our biggest barrier to serious and sustainable wealth creation." Stick with a strategy; while a few investors make a lot of money by timing markets, they are the exception. Instead, develop strict investment strategies and stick with them. "If you give yourself plenty of time and patiently stick with a well-designed investment strategy, you will almost certainly be a lot better off in 10 years time than those who don't.
This is a time for more sustained wealth creation due to higher salaries and fewer family costs (many children by now will be financially independent). For many people in their 50s the main financial challenge is to invest their savings to generate a retirement income, and maximize their age pension. In most cases investments are built around some form of allocated or complying pension. While there is a tendency for older investors to be extremely conservative, especially when the economic outlook is uncertain, higher life expectancy means a very defensive approach probably will result in your money running out.
Rules for us all
But whether you are in this, the fourth age of investing, or any of the other ages, all of us have to deal with the same economic and investment climate. We have to make the same range of crucial financial decisions, based on our assessment of the risks and opportunities that exist.
All investors need to guard against assuming the next five years will generate the same sort of returns as the last. "Expecting the second half of the decade to be just as good as the first half would be naive.”It may be, but there are plenty of reasons to think overall returns won't be as strong. One thing that won't change, however, is the need for most people to adopt a suitable investment strategy and then resist the temptation to chop and change when a particular investment sector generates disappointing returns. As already stressed, it is also crucial to avoid thinking you will be able to make big gains quickly. "Everyone wants to be rich tomorrow, but the risks aren't worth it. Impatience is our biggest barrier to serious and sustainable wealth creation." Stick with a strategy; while a few investors make a lot of money by timing markets, they are the exception. Instead, develop strict investment strategies and stick with them. "If you give yourself plenty of time and patiently stick with a well-designed investment strategy, you will almost certainly be a lot better off in 10 years time than those who don't.
“Your success in investing will depend in part on your character and guts, and in part on your ability to realize at the height of the ebullience and the depth of despair alike that this too shall pass.”John Bogle.
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