Would you like to create a seven-figure savings pot by the time you retire? Of course you would. By following the tips you could give yourself a great chance of doing just that.
Get investing ASAP
It’s not impossible to create a big retirement nest egg, even if you find yourself late to the party. Living ‘in the moment’ is a perfectly human trait when you’re in your 20s (and for some, well into their 30s, too). And this often means spending your hard-earned cash immediately. Retirement seems a lifetime away and so worrying about your finances in old age can be punted into the long grass, right?
Well, yes and no. Of course this depends on how large a pension pot you are looking to live off in your autumn years.
If you’ve just turned 40 and have only just started thinking about investing for retirement it’s not too late to create a big cash pile. But if you want to create truly titanic returns, the sooner you get on it the better. The later you leave it, the more you will have to set aside each month for your investment pot to hit the magic one-million-pound mark. And many people stuck in this boat face having to save some truly mind-boggling amounts to hit millionaire status, sums which are either impractical without having to seriously compromise your living standards, or are just downright impossible.
Don’t be too risky
We all love the idea of getting rich quick. And as investors, we love stories of how investing “x amount” into an asset 20 years ago would have made you super-rich in retirement, or even allowed you to hang up the work boots way ahead of schedule to ‘Live the Life of Riley’.
We’ve all heard about the many millionaires Apple has created since its IPO in December 1980 when its shares sold at just $22 apiece. Dreamt of buying gold in August 2009, when the fallout of the Great Recession caused its value to double in less than two years to current record highs above $1,900 per ounce. The rapid rise of Bitcoin up until late 2017 showed how we remain seduced by the potential to make quick, easy, stratospheric gains.
But for most of us the practice of investing is a longer slog played over a number of years. The most successful stock market players realise this and don’t make dangerous gambles with their money. For many, Bitcoin represented a great way to get rich fast and it indeed made many individuals incredibly wealthy. Try talking up the virtual currency to those who piled in at the top of the market in December 2017 and whose holdings have lost a shocking 80%+ of their value in that time, though!
Slow and steady usually wins the race. Just ask the growing number of millionaires that have made a fortune through stocks and shares ISAs alone (some 170 according to recent research from Hargreaves Lansdown versus just three in 2012). Armed with a level head and a decent level of research, it’s indeed possible to become a millionaire retiree.