Are you an Active or a Passive Saver?
Published on January 17, 2012Are you an Active investor or Passive investor?
A Harris Interactive poll conducted online in November 2010 asked 2151 adults about how their savings (if any) are invested now. For their retirement savings, most have parked their money in some combination of stocks/mutual funds, bonds and money market funds; for their personal savings nearly one third (31 per cent) keep their money in bank accounts or CDs. Although individuals will earn negligible interest on those accounts, it seems that for those who struggle to save, “Better safe than sorry” is the guiding factor as they seek the most stable, safest investment vehicles possible.
Concern about market volatility appears to affect the younger age groups as well, even though people in their 20s and 30s have many more years ahead of them to build their retirement wealth, and they are often counseled to be more aggressive early on with their investing.
Harris also reported that a majority of respondents had not changed their portfolio mix in their personal savings and investments or their retirement savings and investments in the six months leading up to the poll (70-74 per cent). A hands-off approach doesn’t serve anyone well except the financial institutions holding those funds. Even the most cautious of investors should sit down with their financial advisers periodically to review their account’s performance, revisit their long-term and short-term financial goals, and make course corrections for how their funds are invested.
What many consumers do not realize is that even for those individuals who have just a few thousand dollars socked away for their retirement, they can boost their yield with some know-how and moxie through a self-directed IRA. Investors who are interested and comfortable in taking a more active role in their retirement strategy should learn more about this growing trend in retirement savings strategy.Back to Blog