How To Invest In Your 60s

woman in her 60s ready to retire

Your financial and life goals are likely different at 60 than they were in your 20s. If you’re nearing 60 or 70, switching financial gears into retirement requires you to know what investment options make the most sense for your financial situation. But how can you possibly know what to choose with all of the contradictory advice out there, especially where to invest in a bear market? 

Yes, investing in your golden years requires a little more consideration of your risk level. But, when is the last time you reevaluated your risk or balanced your portfolio to realign your investments with your financial goals?


Learn how to find the right balance with strategic asset allocation. 


Set goals

With solid ideas for retirement, it’s time to create a plan for how to turn ideas into reality. While this may seem like an overwhelming task, there are some easy steps that simplify the process:

  • Set goals. In order to formulate a comprehensive financial plan, ask yourself these questions to get the ball rolling:
  1. What are your financial goals moving forward?
  2. How much money do you need to achieve those goals? 
  3. What is your time horizon (how long will it be until you need to tap into your investments/savings)? 
  4. How much risk are you willing to take on in order to meet these goals?
  • Determine what investments best fit your needs and how much risk is right for you. 

Have any previous investments failed miserably or performed poorly? Do not let this deter you from investing again—everyone makes mistakes! If possible, try limiting yourself from making major investment decisions for at least six months after such losses, if going about this on your own. 

We have heard all kinds of stories and have empathy for all who feel cheated. Use any losses as learning experiences to decide which types of investments might work better in the future. A financial advisor in Buffalo, Grove, IL, can assist you with both impactful items on your to-do list. 

Based on your retirement income, we will use strategic investing to ensure your investments are working for you.

Know what you’ll need to maintain your lifestyle 

If you’re nearing or in your 60s, you may need to prepare for retirement. You should consider the following:

  • Social Security benefits: This retirement benefit from the federal government pays you monthly income after you reach your full retirement age. You can start receiving benefits early, or wait until your full retirement age to receive larger checks. Talk to our financial advisors in Buffalo Grove, IL, about avoiding penalties for tapping in too early. 
  • Medicare is a health insurance program for people 65 and older. If you’re eligible for both Medicare Part A (hospital insurance) and Part B (medical insurance), you’ll need to pay premiums each month with automatic deductions. Talk to us about retirement planning that accounts for short-term and long-term medical care.

Max out your retirement accounts

getting ready for retirement

If you’re saving for retirement, it will help to max out your 401(k) or IRA. This is because these accounts offer tax advantages that make them more beneficial than other investment options.

There are many strategies to extend your retirement savings. It’s vital to have a diversified portfolio of low-risk investments such as certificates of deposit (CDs), mutual funds, and Treasury bonds in order for any investment strategy to be sustainable over time. Again, investing in a volatile market is a whole different ball game.

Diversify your portfolio

Diversification is a crucial way to reduce risk in your portfolio. It’s important to invest in different asset classes, such as stocks, bonds, and real estate, which have different risk/return profiles. By investing in each of these four major asset classes (also known as “asset allocation”), you’ll be able to balance the ups and downs of the market while still making reasonable returns. 

You can also diversify within each asset class—for example, by investing in both large-cap stocks and small-cap stocks—to further reduce your risk exposure without sacrificing growth potential.

Low risk investing

Low risk investments are ideal for individuals who don’t want to take on too much risk or are still years away from retirement. You can invest in low risk investments, such as bonds, CDs, and money market accounts. These investments have a low return but are also very safe. 

Rebalance your portfolio

If you have been following a target asset allocation, then it’s time to rebalance your portfolio. Rebalancing can help you reduce risk, lower taxes, and increase returns by keeping your investments in line with your goals. 

A portfolio that is not rebalanced often will drift away from its target, which can lead to over- or underweighted positions that may be difficult to adjust without taking on more risk than desired. For example, if you are 20% invested in stocks and 80% invested in bonds but want your portfolio to be 40% stocks and 60% bonds instead (a typical target allocation), then selling some of the overvalued stocks and buying more undervalued bonds will bring the two closer together.

Make strategic withdrawals

Withdraw sign

If you have a portfolio of stocks, bonds, mutual funds and other assets, it’s important to realize that when you withdraw money from your investments, the value of those investments can decrease. So, it’s important to make strategic withdrawals from your portfolio so that you don’t deplete its value too quickly.

Our team of retirement planners in Buffalo Grove can help you decide what to withdraw and when. 

Consult a financial advisor before you pull the trigger on any investments

You may have heard the phrase “a picture is worth a thousand words.” This expression could not be more true in the case of investing. 

Your financial advisor will provide you with an in-depth analysis of your investments and help you determine which ones are best for your situation. In addition, they can help you avoid costly mistakes. 

A financial advisor in Buffalo Grove, IL, at SGL, can make sure your investments align with your game plan.

Your goals are likely different now than when you were just starting your career, so it’s important to take this into consideration before making any financial decisions. Once you know what your priorities are and how much risk is right for you, let’s talk about how best to invest those assets so that they can work as hard as possible for you.

Download this free eBook if you are ready to retire

Bottomline: Your risk, retirement income, and financial objectives need to align. With strategic investing and consistent communication with your advisor, you can rest better at night knowing you are in good hands. 

Read: How Careful Wealth Management Can Help Buffalo Grove Residents Retire Early