Source: Yahoo —
The largest classes of investment for most Americans are retirement funds and real estate. Most Americans have some form of retirement savings, typically held in tax-advantaged retirement account like a 401(k). At the same time, nearly two-thirds of American households own their homes. So it makes sense that someone saving for retirement will consider these two options. If you’re saving up for retirement, should you put your money in a tax-advantaged account or real estate? Another way to ask this question is, should you use your money to buy stocks or property? We explore these issues below.
Invest In Both If Possible
In this article we’ll assume that you have to choose between retirement accounts and real estate. That said, the real answer is that you should choose both if you can.
Investing in both real estate and the stock market gives your portfolio diversity. Although these two asset classes are fairly well correlated (meaning that both tend to do well at the same time and poorly at the same time), they’re still different markets and respond to different pressures.
As a general rule, you don’t want to put all of your money into a single asset class. Whenever possible, don’t just invest in land or stocks. That makes your portfolio more exposed than it has to be. If you have good options for investing in both real estate and the stock market, then we recommend putting some of your money into each.
;
