How Boomers Should Choose Between Stocks, Bonds and Mutual Funds When Investing

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This means that no singleinvestment strategycan be a match for every individuals financial objectives and risk tolerance.

The first step in doing this is to determine your investment objectives.

If youre still looking to amp up your account balance, you might havepure capital growthas your objective.

Many investors choose to pursue a combination of growth and income in a portfolio.

Accurately and honestly determining what your risk tolerance truly is can help you choose the right investments.

The final leg of theinvestment planning triangleis charting out your timeline.

Heres a primer, although theres obviously much more to know about each asset class.

Stocks represent an ownership share in a real business.

you’re free to earn money from stocks in two ways, throughdividends or capital gains.

Bonds are income-generating investments.

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This removes the potential that you could lose your entire bankroll by investing in a single stock.

Choosing among these (and other) investment options is part art and part science.

But with some research and effort, individual investors can accomplish this on their own as well.

Investment planning should be a holistic enterprise.

All investors should start with an emergency fund covering at least three to six months of expenses.

All of these elements are important to have in conjunction with a properly balanced investment portfolio.