On the road to retirement, investors, just like drivers, each have their own style. The key is figuring what type of investor you are by taking into account where you currently stand and thinking about your long-term financial goals. This can help you determine the strategy and route that works for you.
There are three major types of investing styles
Speed is the name of the game. These investors seek greater growth and have a higher tolerance for risk, usually opting for high-return investments such as stocks, even though they also have a higher potential for losses.
The middle-lane driver. Moderate investors fall in between aggressive and conservative styles. A typical strategy might involve investing half of your portfolio in a dividend-paying growth fund.
This is the defensive driver. Conservative investors tend to play it safe and focus on the long term. They’ll usually want to opt for risk-averse investments such as certificates of deposit (CDs) or bonds.
How to invest at any age
20s & 30s
At this point in your life, you may be just starting to plan for retirement— even though it seems far off. You have time to bounce back if any of your risks don’t pay off.
Consider: Holding a majority of your investments in aggressive investments.
Congrats! You’re at the midpoint of your career. No matter when you began saving for retirement, this is the time to buckle down and get serious about getting your portfolio on track.
Consider: Moving toward holding less aggressive investments.
50s & 60s
As you approach retirement, you should think about being more conservative with the savings you’ll come to rely on in the future.
Consider: Having a more even split of aggressive and conservative investments.
70s and up
You’re likely retired by now—or will be very soon—so your focus will have shifted from growth to income.
Consider: Overall moving toward more conservative investments.
Remember, no matter how close you are to retirement, the best time to start investing is now. Just make sure the decisions you make are the right ones for your age, risk tolerance, and long-term financial goals, and monitor your investments annually to make sure they continue to meet your objectives.
All investing involves various risks—including the possible loss of principal. It is possible to lose money by investing in securities. This material is intended to provide information only.
This material is not intended as advice or recommendation about investing or managing your retirement savings. By sharing this information, Prudential Retirement® is not acting as your fiduciary as defined by the Department of Labor or otherwise. If you need investment advice, please consult with a qualified professional. Retirement products and services are provided by Prudential Retirement Insurance and Annuity Company (PRIAC), Hartford, CT, or its affiliates. PRIAC is a Prudential Financial company.
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