Top 5 Investment Vehicles for Retirement

There are many ways to fund your retirement. If you are looking to start saving or beef up your savings before you retire, the following five investment vehicles are the best way to do it. You can talk to your bank, credit union, employer or financial advisor about these products. You can usually get an account opened and start investing with just a few dollars, depending on the policy at your financial institution.

401k

A 401k through your current employer is an obvious choice to help fund your retirement. More and more employers are offering these programs, and many also offer matching contributions, up to a certain maximum amount each year. You may be able to enroll at any time, or you may have to wait for an open enrollment period. Talk to your employer's Human Resources department to find out the details of the employer-sponsored 401k, if any.

Stocks

The stock market is another way to invest a little or a lot of money, and make a valuable return on your investment to help fund your lifestyle after you stop working. You can start out with a few dollars and contribute regularly, or invest a lot and see a bigger return. Your bank or credit union may offer stock brokerage services, or you may wish to retain the services of a qualified broker to assist with this.

Mutual Funds

Many mutual funds allow you to invest as little or as much as you want. However, watch for minimum purchase requirements. Some institutions will waive any fees if you invest a minimum amount each month or quarter. Mutual funds are subject to minimal operating expenses, which will be deducted from your account balance. Mutual funds are a hassle-free way to invest, and your contributions can be directly debited from your bank account.

Annuities

An annuity is a low-risk way to save for retirement. Many financial institutions offer a minimum rate of return, and guarantee that the interest you earn will never drop below the guaranteed minimum rate. Any interest you earn on an annuity is not taxed until you withdraw it, allowing you to benefit from tax-deferred compounding. You can contribute to your annuity at any time, and some institutions offer matching contributions.

Certificates of Deposit (CDs)

A CD/IRA is a great way to grow your retirement funds at a guaranteed rate. You get the security of a CD and the tax advantages of an individual retirement account. Certificates of Deposit are FDIC-insured, and give you complete control over your financial future. CDs mature in as little as 30 days, or as long as five years, so you can earn as little or as much interest as you like.

It's never too late to start saving for retirement. Start today to make sure you can enjoy your retired years comfortably, without the help of your family or the government. Whichever option you choose, make sure you have the guidance of a qualified, licensed investment professional to assist you in making smart choices.

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