As a young investor in my 20s, I look at some of the staggering statistics that show how people in their 40s, 50s, and 60s are not even close to prepared for retirement. That leads me to the conclusion that now is a good time to start preparing. In so doing, I have come up with five tips that lead me to believe that I will be able to retire comfortably in 30 to 35 years.
1. Be patient
If you’re looking to make multi-decade investments that you hope will be paying dividends in your golden years, there’s no need to deploy your cash immediately. There are always going to be pullbacks, even in the best long-term investments. Make a list of stocks or exchange-traded funds that you want to own (more on choosing these in a moment) and pick entry points. For instance, pick a list of 50 stocks or ETFs that you want to hold and tell yourself that you will take positions in them if they correct by 20 percent. While you may not be able to buy all of the assets you want at the prices you want to pay, chances are you’ll be able to buy some of them, especially if your list is big enough. If you are especially interested in owning a particular security that just doesn’t seem to want to go down, then take a half of a position, or even a third of a position. If it comes down you can buy more, and if it doesn’t, then you own some. But keep in mind that every asset has significant corrections, and when you’re buying for the long run, you will do yourself a huge favor by buying on these corrections.