4 mistakes that an elderly investor should never commit
The quality of life at an elderly age major depends on your financial conditions. If you want to keep yourself secure financially, there is no alternative to regular investment. To be precise, you need to take the right investment approach. Here are a few common mistakes that you should never commit with your investment planning.
Opting for high risk bearing investment instrument
As an elderly person, you will finance all of your expenses from the proceeds you will get from investing your lifetime savings. So, at this phase, you cannot afford http://www.medicareadvantageplans2020.org to choose those instruments and domains that are excessively risky. Investing in such instruments, you will stand the risk to lose a major part of your lifetime savings that has been invested in these areas. At this age, it will be impossible to manage such losses. Ideally, you should look for investment options that produces fair extent of return, without exposing you to significant risks.
Not adding diversity to the investment portfolio
Another blunder will be made, if you are not adding diversity to your investment portfolio. You should try to diversify the total portfolio between the maximum numbers of investment tools so that you can gain the best from all these words. Also, with diversity, you will be in the position to manage a loss incurred from one of the instruments with the gains incurred from other areas. This way, you can retain a balance in your investment portfolio and escape investment risks and threats to a major extent.
Ignoring the aspect of liquidity
Especially for elderly people who might find themselves in dearth need of cash any moment, it will be an investment sin, not to give the due importance to the aspect of investment liquidity. In such instances, you will find it impossible to manage the need of dearth cash, if any. Hence, you need to add those investment instruments to your portfolio that are easy to liquidate.
Excessive importance on gold as an investment option
Though it is a fact the gold is one of the most effective investment instruments against inflation, and it retains its value for the longest span, however, it may not be the preferred investment instrument for an elderly person, as gold never generates revenue gains. You can only expect returns from it, when you liquidate the asset. In addition, storing gold can expose you to various threats and risks.