Investment Strategies
Explore popular investment vehicles and approaches to build long-term wealth.
Investment Risk Spectrum
4-5%
5-7%
6-8%
~10%
10-12%
Retirement Accounts
401(k)
Employer-sponsored retirement plan with pre-tax contributions.
- Employer match (free money!)
- Pre-tax contributions
- 2024 limit: $23,000
Best for: Anyone with employer match
Roth IRA
Individual retirement account with tax-free growth.
- Tax-free growth & withdrawals
- After-tax contributions
- 2024 limit: $7,000
Best for: Young investors expecting higher future income
Traditional IRA
Tax-deferred individual retirement account.
- Tax-deductible contributions
- Taxed on withdrawal
- 2024 limit: $7,000
Best for: High earners expecting lower retirement income
FIRE Movement
Financial Independence, Retire Early
The Core Principle
Save 50-70% of your income, invest aggressively, and build a portfolio 25x your annual expenses. Then live off 4% withdrawals indefinitely.
The Math (4% Rule):
FIRE Variations
Lean FIRE
Minimal lifestyle, ~$40k/year expenses
Fat FIRE
Comfortable lifestyle, $100k+/year expenses
Coast FIRE
Invest enough early, let it grow, work part-time
Barista FIRE
Semi-retire with a low-stress job for benefits
Key assumption: FIRE uses 7% real return (10% nominal - 3% inflation) for projections.
Popular Investment Vehicles
S&P 500 Index Fund
Own a piece of the 500 largest US companies.
- Ultra-low fees (~0.03%)
- Automatic diversification
- "Set and forget" simplicity
Popular funds: VOO, SPY, IVV, FXAIX
Target Date Fund
Auto-adjusts asset allocation based on your retirement year.
- Automatic rebalancing
- Gets conservative near retirement
- One-fund solution
Example: Vanguard Target Retirement 2050
Three-Fund Portfolio
The Bogleheads classic: simple, diversified, effective.
- US Total Stock Market
- International Stock Market
- US Total Bond Market
Typical mix: 60% US / 20% Intl / 20% Bonds
Compare Your Strategy
See how your target return compares to these popular benchmarks.