Having a million-dollar portfolio is a retirement dream for many people. In truth, this dream must become a reality for most people who want to enjoy financial independence in their retirement, especially for those under the age of 50.
Some combination of your personal investments and your employer retirement plan will need to achieve this million-dollar mark in order to provide an annual retirement income of $50,000 or more to supplement your government-sponsored retirement plan (like Social Security or a government employee retirement plan).
Making that dream come true requires some effort. While financial success is never a sure thing, I have 10 steps that will go a long way toward helping you achieve your objective. Let’s review the first two today:
Step 1. Set the Goal in Writing
Nobody plans to fail, but plenty of people fail to plan. It may be a cliché, but it’s true. “A written plan” is the leading self-help advice from athletes, business moguls and everyday people who have achieved their goals. The longer term your perspective, the better financial decisions you will make. Studies show that people who get help from a trusted financial advisor stand a better chance of success.
Step 2. Start Saving
If you don’t save, you’ll never reach your goal. If your employer offers a 401(k) plan, enrolling in the plan is a great way to put your savings on autopilot. If your employer offers to match your contributions up to a certain percentage, be sure to contribute enough to get the full match. It’s like getting a guaranteed return on your investment. Finding the cash to stash may be a challenge, particularly when you’re young, but don’t let that stop you from pursuing financial independence. Get in the habit now. The earlier you start, the better off you will be.
Next week, we will review additional steps to help you make a million-dollar investment portfolio not just a dream but a reality. Click here to read part two and part three.
For more insight, listen to Jentner Wealth Management’s weekly podcast by clicking here. Or download Jentner’s newest white papers on The Four Cornerstones of Prudent Investing and The Active Versus Passive Investing Debate.