GOBankingRates works with many financial advertisers to showcase their products and services to our audiences.
These brands compensate us to advertise their products in ads across our site.
This compensation may impact how and where products appear on this site.
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information.
you might read more about oureditorial guidelinesand our products and servicesreview methodology.
If youvenever invested before, it can feel overwhelming or even terrifying.
That goes doubly for retirees, who dont have the luxury of time to replace losses with earnings.
Fortunately, investing can be as simple or complicated as you make it.
However, you definitely want to start simple as afirst-time investor.
Stocks
You have two broad options for approaching stock investments: buying funds or picking stocks.
One is a lot easier than the other.
But as a beginner, you want to keep it simple.
For example, SPY is a fund that just mirrors the S&P 500.
For even broader market exposure, check outVTI, Vanguards Total US Stock Market ETF.
It adds risk to your portfolio at a time when you should be reducing it.
If you feel passionate about picking stocks however, invest in education before you jump in investing in stocks.
Start with these tips forpicking stocks as a novice.
Bonds
Bonds serve several roles in your portfolio.
First, they provide stable income, usually at a fixed interest rate.
you might live off that income in retirement.
Second, many bonds come withextremely low default risk.
What are the odds that the US government will default on its Treasury bond payments?
Beware of low-rated junk bonds, however.
Finally, bonds have a low correlation with the stock market.
As for how much of your portfolio to hold in bonds, theresno magic rule.
Stuller recommends getting expert advice to determine your own ideal asset allocation.
Real Estate
Many retirees like adding real estate to their portfolios.
But there are near endless ways to invest in real estate, some far easier than others.
Real estate syndications can generate high returns withgreat tax benefits, but they come with real risk.
Most also typically require a high minimum investment think $50,000 or $100,000.
That reduces their value as a way to diversify your portfolio.
However, becoming a landlord requires more work and skill than most people realize.
From there, activereal estate investingonly gets harder.
But for some retirees, this can be therapeutic and make for a good hobby or post-retirement gig.
Seamus Nally, CEO ofTurboTenant, recommended starting low and going slow.
My advice for first-time investors who are retirees would be to start small.
Instead of opting for one of those two extremes, consider starting with aflat-fee financial planneror advisor.
Alternatively, you’re able to explore robo-advisors and human hybrid advisors.
For example,Charles Schwaboffers a free robo-advisor with an optional human hybrid upgrade for a flat monthly fee.
Start simple, and when in doubt, opt for passive investments over active ones.
More From GOBankingRates
Share This Article:
