Mutual funds
have a wide variety of uses for savings and investing. Their
are mutual funds that can be used for short-term savings
and long-term savings. Most are for long-term savings.
Savings Accounts:
Short term - An example of a very short-term savings account
( 6 months-one year), could be a money market mutual fund
or income fund.
Mid term - An example of a mid- term savings account (2-
3 years) could be an income -equity fund.
Long- term - An example of long-term (greater than 3 years)
could be a growth or growth and income mutual fund.
Very long-term - an example of very long term, (five years
or more) are growth, growth and appreciation, growth and
income, and international funds.
Retirement accounts:
Retirement accounts are long-term accounts, so example's
of mutual fund types appropriate for these accounts would
be growth, growth appreciation, international, growth and
income or a combination of these funds.
College Plans:
Hopefully you will have at least 10 years to invest for
college, the longer the better. If you don't have ten years
do the best you can. The fund choices will be similar to
retirement funds. Use our financial calculators (College
Funding Calculator ) , to calculate funds needed for college.
Many mutual fund companies have specific college funds. It
is best to start saving for college when your children are
babies.
You can also save for college in a ROTH IRA, funded with
mutual funds. This is also true with other investments.
Mutual funds work best when held long term.
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