Investing can be a tricky prospect, but one thing is for sure: you need to invest in something. Whether it’s stocks, bonds, or real estate, investing money helps you grow your wealth over time. But what, exactly, should you invest in? Different types of investments may appeal to different investors, depending on their financial situation, goals, and lifestyle. Here’s what you need to know about different investment options for various life stages.

Investing in your 20s

When you’re first starting out, it’s tempting to put off investing while you focus on paying off student loans or building up an emergency fund. But the truth is, the sooner you start investing, the better. In your 20s, you have a long time horizon, which means you can afford to take on more risk in your investments. That’s why stocks are a popular choice for young investors.

Stocks can offer high returns over the long term, but they come with more risk than other investments. To mitigate that risk, consider diversifying your portfolio by investing in index funds or exchange-traded funds (ETFs). These funds track a broad market index, such as the S&P 500, and include a variety of stocks from different sectors.

Investing in your 30s

In your 30s, your financial situation may start to stabilize. You might have a steady income, a growing family, and a mortgage. Your investment strategy should reflect these changes. Now is the time to focus on building a diversified portfolio that balances risk and reward.

Real estate can be a smart investment for people in their 30s. Owning a home can be a smart long-term investment, especially if you’re planning to stay in one place for several years. You can also consider investing in rental properties or Real Estate Investment Trusts (REITs) that own and manage properties.

Investing in your 40s

By your 40s, you may have started to accumulate significant savings, but you may also be facing increased financial responsibilities, such as college tuition or aging parents. Your investment strategy should continue to focus on building wealth while minimizing risk.

Bonds are a good option for people in their 40s who are looking for a stable, low-risk investment. Bonds are debt securities that pay a fixed interest rate, and they’re generally less volatile than stocks. You can invest in individual bonds or bond mutual funds.

Investing in your 50s

In your 50s, retirement is likely on your mind. You may be looking for investments that offer income and stability as you approach retirement age.

Dividend-paying stocks are a good option for people in their 50s. These are stocks that pay a regular dividend to investors, which can be a steady source of income. You can also consider investing in annuities, which are insurance products that provide a guaranteed income stream in retirement.

Investing in your 60s and beyond

As you enter retirement, your investment strategy should focus on preserving your wealth while providing enough income to support your lifestyle.

Bonds and annuities are still good options for retirees. You might also consider investing in dividend-paying mutual funds or exchange-traded funds, which offer diversification and regular payments.

Real estate investment trusts (REITs) can also be a good option for retirees looking for a steady stream of income. REITs are companies that own or operate income-producing real estate, such as shopping centers or office buildings.

In conclusion, there’s no one-size-fits-all investment strategy. Your age, financial situation, and goals will all play a role in determining the best investments for you. By understanding your options and working with a financial advisor, you can make smart investment decisions at every stage of life.