What is your time horizon?

One thing that trips up investors is not knowing what their investment time horizon is. Most people who are investing for retirement assume they are investing until age 65 or whatever age they think they want to retire. But is that when they stop investing? Only if you plan to put everything into cash and take it to the bank or put it under your mattress. Your investment time horizon actually ends when you die. A person who retires today at 65 has a very good chance of living another 20 or more years. It's not uncommon anymore for people to live into their 90's. Karl Malden just died yesterday at age 97. My grandmother just turned 95 and my other grandmother who has already passed away, lived to age 99! So you have to consider the fact that your retirement might last as long as 30 years! While last year's stock market crash put a lot more people back into cash and CD's and out of the stock market, a 30 year time horizon pretty much dictates that some of that money should be invested in the market in some fashion. That doesn't mean you should have all your money in the market, but then again, you should not have it all in CD's earning 3% or less either. Figure out how much you should have in various asset classes and rebalance and adjust periodically to make sure you are on track of your goals and objectives. Taxes and inflation are huge threats to your wealth, and stocks, while volatile on an annual basis, are the only way to stay ahead of the game over long periods of time.