“The sooner, the better” – that’s the common recommendation when it comes to building assets and private retirement provision with ETFs. But is investing really pointless after a certain age? Why getting started can still be worthwhile even in retirement.
• An ETF can also be worthwhile in retirement – the investment horizon, goal and risk tolerance are crucial
• If you have 10 to 15 years, you can sit out market fluctuations and benefit from real returns
• Instead of being “too old”, what counts is the right strategy: security buffer, global diversification and clear planning
Getting started in old age: Why it often still makes sense
Exchange traded funds are no longer a fringe phenomenon: According to a BlackRock study, around one in three in the DACH region trades with the popular index funds. But is it still worth getting started even at an older age? According to Financial Flow, in many cases the answer is clearly “yes.” If you know your goals and invest your money for the long term, you can still benefit from the stock market even at the age of 60 or 70. The decisive factor is not the age, but the strategy and the question of whether the capital can remain untouched for several years.
Fabian Frey, head of the Munich branch of VermögensZentrum, emphasizes to Merkur that it is a mistake to believe that you are too old to invest in the stock market at an advanced age: At the age of 65, you have an average of almost 20 years on the clock – and therefore “enough time to sit out market fluctuations.” However, the purpose of investing changes: in retirement it is less about building wealth and more about preserving value.
Goals, time and safety reserve
According to Finanzfluss, whether an ETF is worthwhile depends largely on your personal situation. If you don’t need the money for ongoing expenses, you can invest it profitably – for example to supplement your pension or to inherit assets. The investment horizon is important: at least ten, preferably fifteen years should be planned in order to benefit from the stock market. However, anyone who regularly withdraws money risks losses due to unfavorable sales times.
In an interview with Merkur, Klaus Morgenstern, spokesman for the German Institute for Retirement Provision, recommends the so-called “drawer concept” in such cases: money that will be needed within the next five years belongs in a secure account. Funds that are only needed later can flow into stock ETFs. This way you remain liquid when prices fall and at the same time you can participate in the long-term performance.
This is how you can set up a late ETF strategy
According to the Funke media group, many retirees underestimate their life expectancy and thus waste return potential. Statistically speaking, anyone who retires at the age of 66 still has two decades ahead of them. This speaks for a moderate equity quota and a long investment horizon.
Finanzfluss recommends simple, global ETFs such as the MSCI World. They are inexpensive and widely diversified. Also regular investing via Savings plan is possible – for example if there is money left over every month after paying off the house. Part of the assets can be safely stored in the current account, the rest works in the securities account. This creates a balanced strategy.
An ETF also makes sense in old age
So whether an ETF makes sense in retirement depends less on your year of birth than on your financial goals. If you build up reserves for the next few years, can think long-term and don’t make hasty decisions, you can still benefit from the opportunities of the stock market even in old age.
Finanzfluss emphasizes that even 70-year-olds can invest if they invest their capital for the long term or with the next generation in mind. At the same time, experts warn not to put everything into stocks: a clever mix of security and returns remains the best strategy – regardless of age.
Editorial team finanzen.net