Preparing for the future is something that most of us are doing on a regular basis, but that preparation is most tangible when it comes to getting ready for retirement. Retirement is, quite simply, an expensive prospect. Without income for several decades, you will need to have a sizable nest egg that you can rely upon. Pensions and Social Security could be the start, but diversification is key.
Whether you’re 20 years away from retirement or you’re getting ready to retire in a few months, use this as your guide to international investing for retirement.
Create a Goal and a Budget
No matter how far away retirement is for you, the first step should be creating a monetary goal as well as a retirement budget. This could be a total sum, such as having $2 million in investments and savings by the date of your retirement. Your budget should be a monthly or yearly amount that you believe you could live on comfortably for 30 years or longer.
With this information, you’ll know whether to create a safe and secure investment strategy or one with greater risks and reward potential. This also gives you something to work towards, and it may encourage you to take greater interest in your international investments.
Consider Your Ideal Retirement Destination
Next, think carefully about where you would like to be living in retirement. Of course, many people will stay exactly where they are once they are retired, particularly if the area is already packed with their family and friends. Other retirees, however, will use the opportunity and venture out to a warm and tropical destination overseas.
If you can picture yourself living in a beachfront condo in Latin America, then it makes sense to diversify your assets and go beyond the standard American currency.
If you can already pinpoint a location or even a specific piece of property that is your preferred retirement home, investing in overseas property now now could end up saving you money in the long run. Plus, you can also rent out overseas properties as vacation rentals until your retirement date arrives.
Think About Dependents and Loved Ones
Most prospective retirees have two goals for their international investing. The first is to financially prepare for a comfortable retirement, and the second is to secure financial support for loved ones and dependents.
If your goal is to offer long-term support, then precious metals like gold or silver might be ideal. Other options include trusts or life insurance policies, both of which can give you peace of mind about the people who you care about most.
Choose a Diverse Collection of International Investments
With so many different types of international investing options for retirement, it can feel overwhelming picking the right ones. Ultimately, remember that diversification is key, as that can mitigate your risks. Choose stocks, bonds, currencies, real estate, precious metals and even hedge funds that focus on multiple industries across multiple countries.
International venture capitalism might also be a fantastic choice, particularly for younger professionals who have several years until their retirement.
This strategy guide can help you to create a comprehensive plan to begin investing internationally as you gear up for retirement.
