Importance of Investing “For many busy working-class people, saving money and thinking about setting up a retirement plan is the last thing that they want to consider” (Financial Web, 2008, ¶ 1). People come to the realization that investing in the future is important and take the necessary steps to plan with investment professionals. Another problem is that people do not know what the future holds for them and must protect themselves and loved ones during retirement. Such steps as planning for retirement are often confusing and financial professionals do not have the best interests of all of their clients at heart when it comes to providing retirement vehicles. A person must understand the importance of investing for the future and different research vehicles that can subsidize the investor, such as investment Web sites. The Power of Compounding “At the beginning of the 21st century most young people are told that social security won’t be there for them when they retire from the work force,” (Dividend Investing and Value Network, 2008, ¶ 1). A person must understand how the power of compounding can assist him or her in achieving retirement financial goals. A difference of $400,000 at retirement occurred because the first person, who started investing at the age of 18, was faithfully contributing his contributions to the fund while the second person, who started investing at 28, waited until paying off student loans and other bills. Such a difference meant that the second person invested more yet gained less because of less compounded interest. Investments are very important because the money saved by high school children today means such children can retire with the assurance of proper funding of their retirement accounts. A person who is properly educated in the investment process also increases his or her investment potential, equaling more money in his or her retirement account to take care of future necessities.
Web Sites Help in the Investment Process Given the importance of educated decision-making processes in selecting retirement vehicles, a person can browse the Internet to assist him or her in the proper research of retirement vehicles, selection of said vehicles, and monitoring of held retirement vehicles. Different sites provide different methods of researching and selecting investment vehicles, while other sites provide the ability for the investor to monitor his or her investments. Familiar firms are moving to Web sites providing an investor with the tools to understand the investment process from deciding to purchase retirement options to selecting the proper mixture of instruments and monitoring these instruments to maximize total return on investment, or ROI. The investor must understand what sites will yield ROI from the multitude of sites available. TD AMERITRADE TD AMERITRADE is a site providing different avenues to assist in the investment process. At the Web site, located at http://www.tdameritrade.com, the company identifies six reasons as to why their site provides the best investment opportunities for investors; these include: (a) fair pricing (flat-fee per Internet trade), (b) independent research from leading industry leaders such as Standard & Poor’s, (c) long-term investing products that identify the path an investor which provides for overall retirement goal achievement, (d) easy-to-use tools to monitor the markets and make timely decisions to increase potential ROI, (e) the “Asset Protection Guarantee” (TD AMERITRADE, 2008) to protect investment from market volatility, and (f) extensive customer support online, by telephone, or at a local TD AMERITRADE branch. With the options provided, the investor can make sound investments while monitoring future investment opportunities.
New York Life Investment Management New York Life provides life insurance for consumers but also offers financial investment planning, selecting, and monitoring on its site at http://www.nylim.com. The site provides education for first-time investors and information concerning rollovers for Individual Retirement Accounts, such as how an investor transfers his or her IRA from a former employer to a new employer. New York Life Investment Management also offers different products to assist in identifying the proper investment opportunities for consumers to maximize their retirement funding and assure a guaranteed payout at retirement. The final point of interest is the availability of stock quotes and current market conditions on the site. Charles Schwab Charles Schwab identifies the need for investment opportunities no matter when a person begins investing in his or her retirement. The site, located at http://www.schwab.com, offers different retirement vehicles necessary to identify different investment needs at different times during the investment process. A person can invest with Schwab whether he or she began investing during college or later in life by consulting a calculator to adjust current investments to meet future needs. Charles Schwab also identifies the continuing needs of investors by providing information on how to “keep you money growing after retirement, manage distribution of hardearned savings, and track progress against your retirement income plan” (2008). JPMorgan Chase JPMorgan Chase offers the investment knowledge of JPMorgan with the banking knowledge of Chase Banks. The site offers different methods of investing, including where to start in the investment process, planning tools (such as the effects of inflation on investments and overall net worth of investment plans), stock quotes, and current financial news. JPMorgan
Chase also offers investors the ability to diversify their portfolios with bonds, equity funds, and annuities to reduce the overall risk to ROI by current trends in the stock market. Finally, the site offers information on mutual fund investments and how such investments do not suit all investors. Ameriprise Financial Ameriprise Financial provides a comprehensive approach to saving for all life events called “Dream > Plan > Track >” which allows the investor to tailor their investments to their current needs. The site offers customers with different tools and techniques to maximize investment goals, such as retirement calculators, market information, and research tools. The site also assists investors with questions concerning whether current investments are “on track” for future ROIs. Importance of Investing Revisited People must understand the importance of investing and the availability of Web sites to assist in the planning for investments, selecting proper financial instruments, and monitoring said financial instruments to make timely changes. Different sites provide different financial instruments to assist the investor in yielding a greater ROI and make educated decisions on the future value of their money based on present investments. Without the use of New York Life and other Web sites, investors could not buy financial instruments online, trade financial instruments online, and monitor financial instruments online, thereby missing a key opportunity and losing money in the investment process.
References Ameriprise Financial. (2008). Retirement. Retrieved December 27, 2008, from the Web site: http://retirement.ameriprise.com/planning-for-retirement/ Dividend Investing and Value Network. (2008, August 1). The importance of investing for retirement as early as possible. Retrieved December 27, 2008, from the Web site: http://www.thediv-net.com/2008/08/importance-of-investing-for-retirement.html Financial Web. (2008). The Importance of Investing for Retirement. Retrieved December 27, 2008, from the Web site: http://www.finweb.com/financial-planning/the-importance-ofinvesting-for-retirement.html JPMorgan Chase & Co. (2008). Retirement and Investments Overview. Retrieved December 27, 2008, from the Web site: https://www.chase.com/ccp/index.jsp?pg_name=ccpmapp/smallbusiness/retiring_investin g/page/bb_retire_invest New York Life Retirement Plan Services. (2008). Retirement Services for Individuals. Retrieved December 27, 2008, from the Web site: http://www.nylim.com/retirement/0,2058,30_1002467,00.html TDAMERITRADE. (2008). Why choose TDAMERITRADE as your online broker? We dedicated to helping you along the path to financial independence. Retrieved December 27, 2008, from the Web site: http://www.tdameritrade.com/whychoose.html