Christine Romans, CNN’s chief business correspondent and Early Start anchor, has a new book coming out for millennials, entitled “Smart is the New Rich: Money Guide for Millennials.”
“Now that the economy is beginning to heal, smart investors need to be extra careful not to sabotage their retirement planning themselves,” she writes.
1. Ignoring your 401(k)
Romans points out that in order to continually have your money working for you, you shouldn’t enroll in your 401(k) and then never look at it again. Instead, you should be reallocating your assets on a half-yearly or yearly basis.
“By not reallocating your assets periodically, you risk getting off track from the right asset allocation for you,” Romans writes. “A young person should have more stocks and fewer bonds than someone approaching retirement.”
To figure out what mix is right for you, try a simple formula based on your age. If you don’t have a 401(k) but are saving in an IRA, you’ll want to be similarly attentive.