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Mutual funds were moderately successful until the advent of the investment retirement account and in particular the 401(k). Corporate insiders persuaded the federal government to allow for the 401(k) in lieu of offering employees the traditional pension. When this happened the employees lost the protection of a specialized financial manager who could manage. The 401(k) FORCES individuals into mutual funds that are notorious for defrauding the public of its savings. Ironically, the company has corporate attorneys who do nothing but invent new ways for corporate insiders to suck money out of the firm in the form of perquisites, stock options, and golden parachutes. Why is this so tough on the employee? The 401(k) plans do not offer individual stocks only mutual funds. What a scam! Corporate executives have forced you to place your retirement dollars with their cronies in the securities industry who manage the investment pools. Does that mean the 401(k) is a bad deal? That depends. If your employer matches a percentage of your wages it may be a fair deal but you should only contribute only up to the matching limit. After contributing the maximum matching put the rest in a Roth IRA. How WillYou Retire? Most workers learn early on in the game that this type of pension will not offer them the expected returns. Many people are learning that they will not be able to live comfortably on their pensions. This forces them to take matters into their own hands. There are three ways to build wealth without quitting your job. Invest in property, invest in stocks, and build a passive income stream. While these may be daunting for the average worker, who expected their company to take care of them, they are not really all that difficult to get into. Passive income is more common than you think. People invest in franchises, build retail outlets, and sell online every day. Today's disposable society will never run into an over saturation of products needed to feed a gluttoned society. Property investing is safer than most people think. The banks have started to adopt more `investor friendly' mortgage products. Property investing is currently one of the most popular wealth building endeavours in the world. The trick is to learn everything you can, and then invest. Look at it this way. The investor purchases $1 million worth of properties, 5 properties. The rents cover the mortgage payment and upkeep. Ten years later the portfolio is sold. Equity in each property grows $50 000 over those 10 years. Now, the investor has $250 000. The investor may either walk away with their quarter of a million, or they may use it to pay down mortgages on 2 or 3 houses. Now, 80% of the rent on those 2 houses is 100% passive income, $1600 a month. Stocks are not as risky as most people think. There are safe and secure ways to invest in stocks. They may not offer the best returns, but for retirement purposes, they are adequate. No matter how you look at it, there are options that will work, even for people who are approaching retirement age. There is no reason why people need to work all their lives, and then scrimp and save through their retirement.
Article Source: http://www.bharatbhasha.net Article Url: http://www.bharatbhasha.net/finance-and-business.php/63259 Article Added on Wednesday, July 11, 2007
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