Every American knows about Wall Street.
Even if you’ve never been to New York City, you know that it’s a worldwide economic hub where people from all over the world gather to buy and sell goods on the stock exchange.
Not only is it an impressive travel destination, but it also offers citizens the opportunity to invest their hard-earned money in the hopes that it will grow. A wise investment can make your wealth grow even faster than it would if it were merely sitting in a savings account.
But a bad investment has downsides. What is the worst-case scenario? You could lose everything that you invested if a company goes bankrupt or the market crashes. You may have learned about the great stock market crash of 1929 in school. Click the link: https://www.federalreservehistory.org/essays/stock-market-crash-of-1929 to find out more.
While some might enjoy the risks associated with investing, for others, it can be a total nightmare. It can be even worse if you aren’t investing your “fun money,” but instead have your retirement fund tied up in the market.
Many companies offer something called an IRA as an incentive for working for them. IRA stands for Individual Retirement Account. It is called this because even though it is offered through an employer, the funds in the account are for you and you alone.
If you aren’t familiar with this type of account, we’ll give you a quick overview.
An individual retirement account offers you the opportunity to set aside a certain amount of money, tax-free, with the purpose of saving for retirement. This means that in exchange for you not paying taxes on the money, you agree to let it remain in the account until it reaches maturity.
Usually you will set a term with your banker. Most accounts require you to wait until you reach the age of fifty-nine and one-half before you are able to make a withdrawal.
Of course, there are a few exceptions to this rule. Some accounts offer you the option of making a withdrawal early if your needs meet certain qualifications. For example, if you need your money in order to pay for immediate housing for you or your family, you may be able to do this without issue.
Even if your needs don’t match up with one of the predetermined acceptable reasons to make a withdrawal, you would still be able to do so. The only catch is that you may be subject to fines, fees, or penalties. Click here for more information about these fines.
You may recall that money in an individual retirement account is money that has been put away before taxes. If you make an unapproved withdrawal, you may find yourself on the hook for those taxes . This can end up being quite a substantial amount of money.
One benefit to an individual retirement account is that your employer may choose to match any contributions that you may make. That information may be available from your human resources department.
If an individual retirement account is part of your benefits package at work, you may already have a substantial balance in your account.
But just like every other aspect of American life, there are no one-size-fits all solution that works best for everyone. You may feel that the restrictions on an individual retirement account are unsatisfactory for you.
Are you trapped into accepting things as they are? Of course not!
In this article we’re going to take a look at the options you have when and if you decide to transfer your money into another account or investment opportunity.
Dream Big
The first step you’ll want to take when researching investment opportunities is to sit down and make a list. No, not of the things you’re eager to buy with the money you pull out of your retirement account.
Instead, you’re going to make a list of your financial goals.
Do you want to retire at forty-five instead of at sixty-seven? Write that down. Click the link for more information about social security benefits.
Would you like to purchase a go-kart business to stretch your money further in your golden years? You’re definitely going to want to write that one down.
How about having a little cushion in case of any unexpected medical expenses? You know what I’m going to say. Write that goal down, quickly, before you forget!
If you have a spouse, partner, or adult children living at home with you, you should bring them into the conversation. They might have questions, concerns, or desires that you will want to take into account.
In the planning stage of your research, the sky is the limit. Don’t be afraid to write down anything that comes to mind. You won’t be making a commitment – yet.
Hit the Search Engine
Once you’ve outlined everything you want out of your retirement account, it’s time for the real work to begin.
You’ll want to research everything on your list. That means finding out how much you would need to start a go-kart business.
Don’t let the go-kart idea intimidate you. Your ideas don’t need to be so outlandish. Instead, focus on the ideas that you’ve generated with your family and loved ones.
You may find that you’re able to dismiss some ideas quickly. For example, you may find that the startup costs of your business are higher than you expected. Go-karts burn out their motors pretty quickly. All of that can add up.
Don’t be discouraged; this is all part of the research process. There’s no shame in eliminating some of your ideas. By the end of the process, you’ll be left with a few truly viable options to carry you forward.
Check the Financials
Perhaps you will end up deciding that you want to split your investment up, instead of putting all of your money into one place. That way, you’ll minimize your risk. That is because it is unlikely that all of your different investments are going to fail.
One thing you may want to do before making any final financial decisions is to learn about precious metals investing to see if it’s right for you. Some people find this option attractive because it offers an opportunity for the average investor to step away from paper currency and trade in something more stable.
Precious metals have been around for thousands of years and they have never decreased in value.
No matter what you choose, the most important part of this process is finding out what is right for you.
