5 Reasons To Continue Buying Stocks Even After You Retire

5 Reasons To Continue Buying Stocks Even After You Retire

Many people make the mistake of completely moving away from stocks to more conservative investment and savings options when they are nearing retirement. While it helps to rebalance your portfolio to include less risky investment and savings options as you get older, it is not a good idea to completely stop investing in stocks. Stocks provide a hedge against rising costs of living and inflation, without which your retirement corpus may not last for a very long time. So, here are some reasons why stocks make a great buy even for older investors:

They Offer Good Returns

There may have been a time when cash and bonds offered decent returns to investors. However, they don’t anymore. This means if you solely invest in bonds and cash, your personal spending will outpace the returns you earn.

Increasing Life Expectancy

Due to medical advancements, you may very well live longer than you think you will. So, while it’s a good idea to protect your wealth, you also need this money to last you around 30 years, if not more. The only way to do this is by investing in the stock market.

Not All Stocks Are Risky and Volatile

It is a common misconception that investing in stocks is risky because all stocks are volatile. In fact, many stocks are extremely safe and give good returns to investors. Stocks of large-cap companies, for instance, are not as volatile or risky, and they are usually a good bet for retirees.

You Can Have a Diversified Portfolio

Remember that your portfolio need not be made up of only stocks. It’s okay to invest in low-risk avenues as well, as long as you have at least a few stocks in your portfolio.

Markets Pick up Quite Quickly

Although downturns are unavoidable, the stock markets usually pick up quite soon. So, even if you lose some money in the market, you will likely be able to make it back in a few years’ time.

Having the right stocks in your portfolio is a great way to build wealth over time. Not only can it transform your financial life, but also that of your heirs if you play your cards right!