Boomer Investing: Balancing Your Portfolio

Posted by Rebekkah On March - 19 - 2014 0 Comment

I’ve been advising investors for a long time. A good percentage of my Boomer clients need help with diversification. Their parents lived through the Great Depression, so many of them inherited a habit of hoarding their assets. This is one of the reasons why the Boomer population has so much of our nation’s wealth. But this also makes them loathe letting go of habitual investments that may not age as gracefully as they do.

Then again, some of my Boomer clients are seven steps ahead of the curve, watching eagerly for cutting-edge opportunities that they can blaze a trail on. But not all of these oddball investments are worth pursuing.

So what’s the right balance?


Often one of the first questions I get from a new client is “What’s safest?”

What they mean is usually “what’s reliably valuable?” Historically, inherently valuable and scarce goods will always be in demand. Precisely for this reason, investment in precious metals is a go-to for most Boomers. I do recommend many of my clients to attain a gold IRA because the Boomer sensibility tends towards practicality over novelty.

When it comes to stocks, we’ve all heard “subtract your age from 100 to get the percentage of your portfolio that should be stocks,” (e.g. If you’re 65, 35% of your portfolio should be stocks.) I feel it’s too simplistic for individual situations, but I do recommend for Boomers to sell or gift stocks out of their portfolio as they age. This doesn’t mean that stocks are a young person’s game so much as it means that you’re (hopefully) established enough to take the safe road and still be successful.

As we age, we don’t need to be as concerned with our long-term prospects. Our portfolios (again, hopefully) don’t need to undergo as much growth as when we’re young. Steady is the way to go, so I always say you should invest like you’re planning on living forever, so I also suggest bonds investment.

Fingers in multiple pies will make for a sturdy portfolio that doesn’t stagnate.

We All Need a Wild Card

Especially recently, I’ve heard a lot about “this whole Bitcoin thing” and whether I think it’s worth going after.

In the past, I’ve also heard about investing in comic books, lunar real estate, and Beanie Babies. People have interests all over the map, but not all of them are advisable.

As for “this whole Bitcoin thing”, it will almost certainly be profitable for some people. In terms of Boomers who are retired or looking to retire wanting to make a serious investment, I would say nay.

The fast-moving cryptocurrency tide is an experiment in radical ideas in a tech-oriented world- not very stable ground. But a diversified portfolio can benefit from a little of the unexpected.

Relying on a variety of staple investments is a widely-accepted investment strategy for a reason. But don’t be afraid to follow your passions (and your curiosity) with a slice of your portfolio. You’re at just the right stage of life for an adventure.

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