According to the study, 85% of Americans are going to continue saving even when the economy turns around. Likewise, retirement savings are a huge goal Americans are striving for.
The simple step of taking control of ones’ investment portfolio by properly diversifying and keeping a simple but structured strategy in place will help. ETFs are a useful tool because they can serve as a long term buy-and-hold investment and do not cost investors as much as other actively managed funds. ETFs can also trade smoothly like a single stock and target specific sectors and asset classes for good diversification. [What are ETFs? -How Diversification Reduces Risk]
Furthermore, a strategy is important to help investors deal with market volatility. By defining an exit strategy and setting a stop-loss, investors can help cut the risk involved with emotionally charged investing, common during periods of market swings and trendless markets. [ETF Inflows up 54% in 2011]
A simple trend-following strategy, such as following the 200 day moving average of an ETF, can also help outline when to enter or exit a fund.
Tisha Guerrero contributed to this article.