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Wealth building is as much aboutstrategy and consistencyas it is actual dollar amounts.
I always say every dollar needs a specific job.
So the first thing would be to understand what are we trying to accomplish?
Is it retirement at a certain date?
Is it putting kids through school?
Is it to buy a house one day?
Consider Taxes
Another important key is to consider taxation when you save money.
So somebody whos younger, lets say in their twenties, has just agreater risk tolerance.
The aggressive investor might have an 80/20 portfolio (which is 80% equities and 20% bonds).
More bonds means less swing, he explained.
But over time youre going to get amuch lower average growth rate.
For people with a higher risk tolerance, he recommended more equities.
This allows you to engage in what is called dollar cost averaging.
And my average cost into the market over time will be less than the overall long-term value.
Historically, the markets been positive a hundred percent of the time.
So over long-term periods, we get growth.
Just be consistent about savings, and dont panic at any dips.
Same thing with saving.
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