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Tips for Staying Diversified
It can be mighty hard to resist the temptation to invest on an impulse or bail out of the market during a down time. But when you maintain a long-term perspective on the investment options, you may find that, when the time comes to enjoy the fruits of the investment options, you may have a much better harvest if you stay the course.
Here are a few easy tips to help keep the investment options on track and well diversified:
- Don't chase returns. There's no guarantee that last year's bigger performers will keep rising.
- Think globally. A well-diversified portfolio may include an international component.
- Don't bet on a single investment option. Many experts agree that no more than 10% of your retirement contributions should be in a single stock, but some savers may have more than that invested in the stock of their own employer.
- Monitor your investment options. If you're not interested in periodically rebalancing the account the plan holds for your benefit, consider a life-cycle investment option.
- Consolidate accounts. If you have several retirement accounts, you may have redundant investment options, in addition to added paperwork.
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