Saving money is a great start, but savings alone generally can’t outpace inflation. So it’s crucial that your hard-earned money is optimally invested for growth, income, or a combination of the two, depending on your goals and risk tolerance.
Whether you’re a novice investor or have quite a bit of experience, it’s important to be clear on your investment goals, how long you’ll be saving until you retire, and the level of investment risk that you’re comfortable with.
Most investors become more conservative as they get older; so plan on revisiting your goals and comfort with risk periodically.
What you can do now:
- To clarify what type of investor you are and how much risk you’re comfortable with, take our Investor Profile Questionnaire.
Our perspective is that asset allocation—how you spread out your money between stocks, fixed income, and cash investments—is essential to long-term investing success. These three basic asset classes respond to the market differently at any given time, so when one is up, the others might be down.1
Your goal should be to have an appropriate mix of different types of assets in your portfolio, so that it can better weather market ups and downs.
You can use our model portfolios as a guideline for helping determine the proper mix of stocks, fixed income, and cash investments that best fit your investment strategy and tolerance for risk.
- Cash and Cash Investments
- Fixed Income
- International Equity
- Large-Company Equity
- Small-Company Equity
What you can do now:
- Learn more about asset allocation and diversification.
- Get details on Schwab’s range of portfolio management services, which give you the levels of guidance and diversification that are right for you.
- If your workplace retirement plan offers investment options, check to make sure that your overall portfolio is aligned with your risk tolerance and target asset allocation.
- If you're a Schwab client, log in to evaluate your portfolio and take advantage of a personalized retirement consultation2 with a Schwab investment professional by calling 888-213-4695.
1. Asset allocation and diversification strategies do not ensure a profit and do not protect against losses in declining markets.
2. The consultation is available only to clients with at least $25,000 in assets at Schwab or prospects with at least $25,000 in assets available to bring to Schwab. Individualized recommendations are available only to Schwab clients and are limited to assets held in a Schwab retail brokerage account. Information provided to prospects, or pertaining to assets held outside of Schwab, as part of the consultation are examples of the kinds of recommendations available on assets held at Schwab; these examples do not constitute recommendations, solicitations or investment advice.
Withdrawals from an IRA or qualified retirement plan prior to age 59½ may be subject to a 10% federal tax penalty on earnings.
The information provided is not intended to be a substitute for specific individualized tax, legal, or investment planning advice. Where specific advice is necessary or appropriate, Schwab recommends that you consult with a qualified tax advisor, CPA, financial planner, or investment manager.