{"id":6660,"date":"2013-07-17T14:34:42","date_gmt":"2013-07-17T21:34:42","guid":{"rendered":"http:\/\/www.marketriders.com\/investing\/?p=6660"},"modified":"2016-12-21T07:28:30","modified_gmt":"2016-12-21T15:28:30","slug":"how-to-invest-in-stock-for-retirement","status":"publish","type":"post","link":"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/","title":{"rendered":"How To Invest In Stock For Retirement"},"content":{"rendered":"

A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question. Beginning investors are met with a range of possibilities, each with their own strengths and weaknesses.<\/p>\n

These days, people own mostly stocks and use bonds as a counterbalance. Nevertheless, in even the most conservative retirement portfolio you will (and should) find some stocks.<\/p>\n

\"how<\/a><\/p>\n

So, how to invest in stock? Here’s a simple breakdown:<\/p>\n

1. Buy shares<\/strong><\/p>\n

How-to:<\/strong>\u00a0Buy them through your broker or online using the ticker symbol.<\/p>\n

The good:<\/strong>\u00a0Direct ownership can be a great source of wealth-building power, assuming you buy at a low value and hold it long enough to realize a gain. In the meantime, many firms pay dividends.<\/p>\n

The bad:<\/strong>\u00a0Stocks\u00a0can be volatile, so holding them after they fall below your purchase price is\u00a0emotionally taxing<\/a>. Dividends can be cut or halted altogether. Trading triggers taxes in non-IRA accounts, and trading fees add up.<\/p>\n

The ugly:<\/strong>\u00a0People love a winner, so they love\u00a0stock picking<\/a>\u00a0and tend to\u00a0buy the stock everyone else is buying<\/a>\u00a0\u2014 after which it crashes back to earth. Worse, individual companies can fail, making your holding worthless.<\/p>\n

2. Buy stock mutual funds<\/strong><\/p>\n

How-to:<\/strong>\u00a0Similar to buying individual stock, a ticker represents the fund. Underlying that ticker is a manager who buys and sells a variety of stocks on your behalf. Pricing is end of day, as with all mutual funds.<\/p>\n

The good:<\/strong>\u00a0If you believe the manager is talented, you get to outsource the trouble of stock selection. Owning a mutual fund also offers diversification.<\/p>\n

The bad:<\/strong>\u00a0Fund fees<\/a>. Your manager’s performance will be stunted by the cost of his or her advice.<\/p>\n

The ugly:<\/strong>\u00a0Seven out of 10 stock fund managers fail to beat the broad market benchmarks in any given year. Even a “hot” manager can fall behind the eight ball.<\/p>\n

3. Buy index funds or\u00a0ETFs<\/strong><\/p>\n

How-to:<\/strong>\u00a0These also trade as tickers. There are differences, but one key distinction is that\u00a0index funds<\/a>\u00a0are priced end of day and\u00a0ETFs<\/a>\u00a0trade all day, like common stocks. Both types have very low fees, and most are built to track broad, well-known indices.
\n\"\"
\nThe good:<\/strong>\u00a0You don’t get an “average” return, you get the market return. Over time,\u00a0research has shown, market returns dramatically outpace active investor returns<\/a>.<\/p>\n

The bad:<\/strong>\u00a0You are not buying any advice at all, which is why they are cheap. Keep in mind that a simple S&P 500 index fund by itself is not a portfolio, it’s just stock exposure at a low cost.<\/p>\n

The ugly:<\/strong>\u00a0There are hundreds of\u00a0ETFs\u00a0out there, some of which are priced at the cost of actively managed funds. Also, some are little more than\u00a0trading strategies using an ETF structure<\/a>. Be sure to buy an ETF you understand.<\/p>\n","protected":false},"excerpt":{"rendered":"

A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question. Beginning investors are met with a range of possibilities, … Read more →<\/span><\/a><\/p>\n","protected":false},"author":8,"featured_media":6661,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_wp_rev_ctl_limit":""},"categories":[3,1],"tags":[],"yoast_head":"\nHow To Invest In Stock For Retirement | MarketRiders.com<\/title>\n<meta name=\"description\" content=\"A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"How To Invest In Stock For Retirement | MarketRiders.com\" \/>\n<meta name=\"twitter:description\" content=\"A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question.\" \/>\n<meta name=\"twitter:image\" content=\"https:\/\/www.marketriders.com\/investing\/wp-content\/uploads\/2013\/07\/512px-Wall-Street.jpg\" \/>\n<meta name=\"twitter:creator\" content=\"@marketriders\" \/>\n<meta name=\"twitter:site\" content=\"@marketriders\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"MarketRiders\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/\",\"url\":\"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/\",\"name\":\"How To Invest In Stock For Retirement | MarketRiders.com\",\"isPartOf\":{\"@id\":\"https:\/\/www.marketriders.com\/investing\/#website\"},\"datePublished\":\"2013-07-17T21:34:42+00:00\",\"dateModified\":\"2016-12-21T15:28:30+00:00\",\"author\":{\"@id\":\"https:\/\/www.marketriders.com\/investing\/#\/schema\/person\/f2be262f5c0f3ed5ad50d6c40640ba8c\"},\"description\":\"A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.marketriders.com\/investing\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"How To Invest In Stock For Retirement\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.marketriders.com\/investing\/#website\",\"url\":\"https:\/\/www.marketriders.com\/investing\/\",\"name\":\"MarketRiders.com\",\"description\":\"How To Become A Better Investor\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.marketriders.com\/investing\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.marketriders.com\/investing\/#\/schema\/person\/f2be262f5c0f3ed5ad50d6c40640ba8c\",\"name\":\"MarketRiders\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.marketriders.com\/investing\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/8e06113f594828daaf313d283544d566?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/8e06113f594828daaf313d283544d566?s=96&d=mm&r=g\",\"caption\":\"MarketRiders\"},\"sameAs\":[\"https:\/\/www.marketriders.com\"],\"url\":\"https:\/\/www.marketriders.com\/investing\/author\/support\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"How To Invest In Stock For Retirement | MarketRiders.com","description":"A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/","twitter_card":"summary_large_image","twitter_title":"How To Invest In Stock For Retirement | MarketRiders.com","twitter_description":"A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question.","twitter_image":"https:\/\/www.marketriders.com\/investing\/wp-content\/uploads\/2013\/07\/512px-Wall-Street.jpg","twitter_creator":"@marketriders","twitter_site":"@marketriders","twitter_misc":{"Written by":"MarketRiders","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/","url":"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/","name":"How To Invest In Stock For Retirement | MarketRiders.com","isPartOf":{"@id":"https:\/\/www.marketriders.com\/investing\/#website"},"datePublished":"2013-07-17T21:34:42+00:00","dateModified":"2016-12-21T15:28:30+00:00","author":{"@id":"https:\/\/www.marketriders.com\/investing\/#\/schema\/person\/f2be262f5c0f3ed5ad50d6c40640ba8c"},"description":"A fundamental building block of a successful retirement portfolio is stocks. How to invest in stock, however, is a tricky question.","breadcrumb":{"@id":"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.marketriders.com\/investing\/how-to-invest-in-stock-for-retirement\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.marketriders.com\/investing\/"},{"@type":"ListItem","position":2,"name":"How To Invest In Stock For Retirement"}]},{"@type":"WebSite","@id":"https:\/\/www.marketriders.com\/investing\/#website","url":"https:\/\/www.marketriders.com\/investing\/","name":"MarketRiders.com","description":"How To Become A Better Investor","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.marketriders.com\/investing\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/www.marketriders.com\/investing\/#\/schema\/person\/f2be262f5c0f3ed5ad50d6c40640ba8c","name":"MarketRiders","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.marketriders.com\/investing\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/8e06113f594828daaf313d283544d566?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/8e06113f594828daaf313d283544d566?s=96&d=mm&r=g","caption":"MarketRiders"},"sameAs":["https:\/\/www.marketriders.com"],"url":"https:\/\/www.marketriders.com\/investing\/author\/support\/"}]}},"_links":{"self":[{"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/posts\/6660"}],"collection":[{"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/comments?post=6660"}],"version-history":[{"count":5,"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/posts\/6660\/revisions"}],"predecessor-version":[{"id":6674,"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/posts\/6660\/revisions\/6674"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/media\/6661"}],"wp:attachment":[{"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/media?parent=6660"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/categories?post=6660"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.marketriders.com\/investing\/wp-json\/wp\/v2\/tags?post=6660"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}