After the beating technology stocks took in 2000, investment brokers and financial planners throughout the nation are offering a consolidated cry: Diversify, diversify, diversify.
That goes double for folks saving for retirement. The idea, experts say, is to make sure all your eggs are not in one basket.
Plus, people moving into retirement years should begin moving a larger percentage of assets to more conservative investments, said Gene McManus, a local accountant and financial planner.
"If you're 50-years-old and you plan to retire in 10 years and you've got 90 percent of your holdings in tech stocks, there's something amiss," Mr. McManus said. "These are very volatile stocks, and more suited to younger investors."
While high-risk holdings can be good in limited quantities, people staring down the barrel of retirement should be heavier into blue-chip stocks and fixed-income investments, such as bonds.
The earlier you start planning, the better.
"Ten years before you retire is a good time to start because there's time to play a little catch-up," said Cameron Brown, a financial adviser with Prudential Securities. "A client realizes nine months before retirement that the bills won't get paid, now that is a bad conversation."
The key to a secure retirement is planning your investment portfolio around your projected living expenses during retirement.
"How much spending cash will you need per month? Will it be $400 or $4,000? When you get to where you smell retirement coming, that's what you need to address," Mr. Brown said.
Every individual's risk tolerance differs. But most financial advisers recommend keeping at least some portion of your assets in stocks, because retirement is no longer a short-term event.
"Life expectancy is on the rise," said Wienges Sanders, investment adviser for New Windsor Capital Management. "`People who are overly cautious about market risk are running another risk - that the income from their assets won't be enough to maintain their standard of living."
Most of what's driving future market growth is coming from the technology sectors.
"Take advantage of anything out there, but make sure you're allocated properly," Mr. Brown said. "It's true a lot of people aren't in touch with retirement. You still have to be diverse; have a plan and roll with the market."
Reach John Bankston at (706) 823-3352 or firstname.lastname@example.org