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Investing for Your Retirement
A Research proposal: Investing for your Future
Section 1: A General Framework
I, like most everyone else, like money. It is what makes us feel alive. Money is needed to do almost anything you can think of. If there is no money, then you are limited to what you can do and what you can have. It is what this nation is based on--capitalism. Most Americans, though, will not reach a place where they feel comfortable. A majority of Americans are living paycheck to paycheck. This is due in part to greed, which is the desire to have more than we can actually afford. The other part is that most people can’t manage money. How many times have you seen commercials about creditors offering to help fix your bad credit? So how can the little man or woman ever get ahead? Emulate those who master money. People who have money or have made money work for them serve as good role models. Through some sort of investment, they were able to increase their net worth. It takes self discipline, determination, and focus to accomplish such goals. These are things that all of us are capable of possessing. In doing this research, I hope to gain extensive personal insight into strategies for reaching short term goals of supplemental income and the importance of long term goals involving retirement.
Section 2: A Special Focus
I decided to do my research paper on investing because I recently attended a seminar on the subject. I was intrigued by the thought of the supplemental income that trading options can provide. I have come to the realization that there is a lot more to investing than what I was led to believe during the investment seminar. First and foremost, you must be financially ready to take on such actions. Credit cards and any other form of debt must be eliminated in order to consider investing. Then, devising a budget is essential to get rid of debt. It also forges a path to initializing a savings account. Finally, the savings account will evolve into investment money. At this point, trading options are still not the first investment vehicle to consider. Mutual funds, stocks, and bonds would be the way to start investing, outside of a 401(K) plan or an Individual Retirement Account. I have learned that trading options is something done to further diversify a portfolio. Option trading also calls for learning proven strategies in order to be profitable. This involves taking courses and reading literature.
As option trading is geared to more seasoned investors, I decided to limit my topic to investing for the long term goal of retirement. It is going to be targeting mainly the young American worker population and also anyone born after the year 1950. The topic is of even more importance to minorities, women, and all lower-income families. These individuals stand to suffer the most if proper planning is overlooked.
Social Security was established in 1936 under the conditions of that time. There was a ratio of thirty-three workers to every one retiree. Today the numbers have drastically changed. The trend is forecasted to worsen to a two workers to every one retiree ratio within the next thirty or so years because of the Baby Boomer Generation. Baby boomers make up the largest portion of the population at present time. The first wave of Baby Boomers is getting ready to enter into retirement. Their inevitable retirements will have a resounding impact on how the government will be able to provide assistance to future retirees. The fact that people live longer nowadays is another issue compounding the problem. Longer life expectancies imply that more finances are needed to support the life spans of Americans during retirement. Due to these alarming statistics, the government is looking for ways to reform Social Security, along with Medicare and defined benefit pensions, which are company paid retirement plans. Social Security makes up a large percentage of most retirees incomes. The average yearly income paid to retirees is approximately just over $10,000. Poverty will continue and may worsen unless investments are taken seriously early on.
Subsequently, I decided to look at investing from a perspective that all young Americans should be able to relate to. In addition, I feel that it should be of significant concern to them. We will all enter retirement at some point in our lives. I feel that the same way we choose to prepare ourselves for things such as taking an exam or making an extravagant purchase of a car or TV, we should be especially concerned with how well we will prepare ourselves for when we can longer work or no longer care to work. What our parents and grandparents were given when they enlisted for retirement will not be the same for younger workers of the present day. It is imperative that you plan now. Investing early allows for greater returns over a longer period of time. There is a saying that should help put some perspective on this: “Time is money!” So if you’re wasting time, you’re wasting money. The early head-start allows for more money to be made. The closer to retirement you are the less time your money has to expand.
Section 3: Working Thesis
It is imperative for young workers to realize and secure financial stability for the future.
I am for creating a budget, getting out of debt, and investing. It is kind of ironic. For the last three years, I have been diligently paying off debt. When I started this, my goal was to simply buy what I could afford and stop overspending. I wanted to focus on living in the now, instead of paying for what I had previously purchased. I wanted to enjoy spending my money: going to eat dinner, the movies, and so on. Instead, I was working to pay off bills. Now, my strategy has lent itself to being able to build wealth for me and my family.
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Copyright © 2006 Jay Torres. All Rights Reserved