How can I diversify my retirement investments?

How can I diversify my retirement investments?

Diversifying your retirement investments involves spreading your money across different asset classes. This can include stocks, bonds, real estate, and mutual funds to reduce risk.

What percentage of my portfolio should be in stocks versus bonds?

A common rule of thumb is to subtract your age from 100 to determine the percentage of stocks. The rest can be in bonds. For example, if you're 30, consider 70% in stocks and 30% in bonds.

Are there specific funds you recommend for diversification?

Look for index funds or ETFs that track a broad market index. Funds like the S&P 500 or total market index funds are great for diversification.

How often should I rebalance my portfolio?

It's generally recommended to rebalance your portfolio at least once a year or whenever your asset allocation deviates significantly from your target.

What are the risks of not diversifying?

Not diversifying can lead to higher risk and potential losses. If one investment performs poorly, it can significantly impact your overall portfolio.