Index Funds
I am83 years old, I have money invested in the market. I’ve been told that I would be
better off to invest my money in an Index Fund, is this wise for me to do? If I do this,
how do I invest in an Index Fund?
Terry Says
Well this is a much larger question First, you need to determine the proportion of your money that should be invested in the stock market at all, and exposed to risk. Age is not the only determinant of this decision. A lot depends on your total assets, your emotional risk tolerance, and your likely need for the money for living expenses before you (and your spouse)die.
The second thing to consider is your tax picture. How long have you held these stocks? Do you have big gains? Would selling make sense now, and would the gains impact things like your Medicare Part B premium? Under current law, if you die while holding stocks with huge capital gains, your heirs pay no tax if they sell the stocks immediately.
And that brings me to the question of how these stocks are titled — in your name, joint name, or perhaps a revocable living trust?
AND THAT BRINGS ME TO THE MOST IMPORTANT QUESTION: Who told you to do this? Just some friend or neighbor? Or someone trying to make commissions on the sale of your current stocks, without considering all of the above??
You need a TRUSTED financial planner — a fee-only FIDUCIARY planner — someone who promises to put your interests first, and not sell you commission products. Even one or two meetings might cost a bit but save you a lot in taxes or mistakes.
Find a fee-only Fiduciary planner you can trust at www.Wealthramp.com.
You will be carefully matched at no extra cost with a planner you can trust, who has been carefully vetted, and who will consider all the issues I mentioned above, and more.
