Yahoo Finance 4 Investments That Can Help You Live Comfortably in Retirement Without Working
Many dream of being able to retire and never having to work again, but not everyone is in a position to save enough money to ensure that. Having a tight budget and not relying too heavily on Social Security may mean that you are planning on working during your retirement.
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That said, you may be able to avoid having to work during retirement by virtue of making the right investments.
The idea is to avoid risk as much as possible while also maximizing your returns. Low risk and high returns are important because you obviously want to spend as little time as possible addressing your financial concerns. Even if you’ve already retired, it’s not too late. You can turn the tables and set yourself up for a work-free future. Here’s how.
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A Condo
Purchasing a condo in a popular tourist destination — one with nice amenities like a pool or gym — will make it attractive to short- or long-term renters. Like other properties in popular areas, your condo is likely to appreciate faster, particularly if it enables renters easy access to the city or various attractions.
Single-family homes do have their own advantages over condos, but condos are the more affordable option and still allow you to build equity. If you buy a condo as a vacation home, you’ll still get to enjoy it during part of the year and use it as a steady source of passive income during the time you rent it out. If you are coming from a larger family home and are considering downsizing, this may be an especially good option for you.
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Dividend Stocks
Blue chip dividend stocks offer regular, dependable income. Be sure to perform ample research, as you may also be able to find undervalued blue chip stocks that have consistent, higher-than-average dividend yields.
Plus, these investments are low-risk. You may even benefit from stock appreciation if the company is undervalued.
Certificates of Deposit
Certificates of deposit (CDs) offer high return rates and are also considered safe investments, as their growth isn’t affected by market fluctuations. Naturally, you don’t want to be taking on a high level of risk as a retiree.
With a CD, you can save for a single, large expense — and as a bonus, you don’t have to worry about pesky fees.
Money Market Funds
Money market funds are a good option as well. In addition to being low risk, they offer high liquidity while being designed around the short term.
Money market funds have some of the lowest volatility of mutual funds. The shorter holding period also means that you won’t need to stress about interest rates compared with funds with long maturity dates.
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