Know How to Invest
One of the most important decisions you have as a participant in the City of Phoenix 457 and 401(a) Plans, is figuring out an investment strategy. Unfortunately, there’s no magic formula, largely because what may be right for you may not work as well – or at all – for someone else.
However, there are some principles that experience of previous investors teaches us. One such principle is asset allocation matters. In fact, many financial professionals believe an investor’s selection of individual securities is not as important as the way they allocate their money across various asset classes – stocks, bonds, and cash equivalents.
The reason is: Rarely do all asset classes move in exactly the same way at the same time. Having assets spread across all classes can help cushion your Plans account against significant losses. Of course, no one can avoid the possibility of losing money through investing. That is called market risk, and all investing involves some amount of risk. No investment strategy can protect you entirely from investment losses, especially in a down market.
The City’s 457 and 401(a) Plans offer an investment menu of options representing asset classes from each of the four major asset classes: risk-based mutual funds, stock-based mutual funds, bonds, and a fixed income (stable value) fund. The five types of stock funds in the Plans in which you can further diversify are international, small-cap, mid cap, large-cap, and specialty.
Decisions about how you invest may be affected by your age, tolerance for market risk, future needs for assets in your account and your plans for retirement. Nationwide Plan Service Representatives are available to help you understand investing strategies; including asset allocation and diversification, as well as market risk and ways you may be able to deal with it.
To discuss preparing for a more financially secure retirement through participation in the City of Phoenix 457 and 401(a) Plans, contact a local Plan Service Representative by calling Nationwide’s Phoenix office at 602-266-2733.
Plan Service Representatives are Registered Representatives of Nationwide Investment Services Corporation, Member FINRA. Neither Nationwide nor its representatives may offer investing, tax or legal advice. Consult your own counsel before making decisions about participation in the city of Phoenix 457 and 401(a) Plans.