5 Ways to Invest Your Retirement Savings

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4. Diversify

Diversifying your investments is literally making sure you don’t have all your eggs in one basket. It reduces the amount of risk you’ll face, and by picking a good group of investments you’ll reduce your losses and maximize your gains. The trick is to pick which stock market investments you’d like to make first. Then, with the rest of your money, you can divide it in half. Place 50% into a low-cost intermediate bond fund and the other half into an insured fund like a money market deposit account.

It’s good to have a mix of stocks and so that you are protected if the worth of your stock falls. Bonds pay lower returns than the stock market, but they present less risk. Interesting the rate of bonds typically increase in value when stocks fall. By using your bank deposits and money market deposit accounts, you’ll be insured for up to $250,000 in losses by the government. However, money market mutual funds that often contain government bonds and Treasury bills won’t provide you with protection, so it’s important to choose the right money market account.