​What’s The Right Retirement Plan Investment Allocation For You?

​What’s The Right Retirement Plan Investment Allocation For You?

09/11/2021 Tags: Announcements


Most retirement plans provide many investment options, and choosing the best option for you can be challenging.

There are three main areas to help you determine the best investments for your retirement account:

  • Goals, including retirement income needs, time, and balance
  • Risk tolerance, including your comfort level with market fluctuations)
  • Existing balance, including other savings

Goals: Your household income goal at retirement is an important factor in determining your investment allocation while you’re working and actively contributing. Having clear, defined goals is essential for measuring your progress. If you’re closer to retirement, focus on your limiting factor of time until retirement to determine your goals.

Risk Tolerance: Your timeframe until retirement and your comfortability should determine the amount of risk you’re willing to take.

If you have more time until you retire, investing more aggressively may allow for more long-term market growth. On the other hand, investing too conservatively in your early years can prevent you from reaching your savings goals in the future.

As you get closer to retirement, you may want to consider gradually shifting your investments to a more conservative allocation. By slowly shifting your investments over time, you can continue taking advantage of market growth and lowering your exposure to market fluctuations.

If you’re closer to retirement, focus on your limiting factor of time until retirement to determine your investment choices. Make sure you’re not aggressively investing money you need in the short term.

Existing Balances: When deciding how to invest your balance, consider your existing household retirement savings. Looking at your overall household savings and the risk level of your other investments will help you determine how to allocate your retirement account.

If you’re 10 years away from retirement with a balance of $10,000, you don’t want to invest the same way as someone with $1 million already saved. If you’re behind on saving for retirement, this may mean you should invest more aggressively to try to grow your balance more quickly.

Let us put you in touch with an Avantax financial planning consultant to help determine the best retirement allocation strategy for you.


Investment advisory services are offered through Avantax Planning Partners℠. Commission-based securities products are offered through Avantax Investment Services℠, Member FINRA, SIPC. Insurance services offered through licensed agents of Avantax Planning Partners. 3200 Olympus Blvd., Suite 100, Dallas, TX 75019. The Avantax entities are independent of and unrelated to CP Financial Services, LLP. Although Avantax does not provide or supervise tax or accounting services, our Financial Professionals may offer these services through their independent outside business. Not all Financial Professionals are licensed to offer all products or services. Financial planning and investment advisory services require separate licenses.



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