Читать книгу Mutual Funds For Dummies - Eric Tyson - Страница 65

Mutual funds and exchange-traded funds can help you achieve various financial goals. The rest of this chapter gives an overview of some of these more common goals — saving for retirement, buying a home, paying for college and higher education costs, and so on — that you can tackle with the help of funds. For each goal, I discuss what kinds of funds are best suited to it and point you to the part of the book that discusses that kind of fund in greater detail.

As you understand more about this process, notice that the time horizon of your goal — in other words, how much time you have between now and when you need the money — largely determines what kind of fund is appropriate:

 If you need to tap in to the money within two or three years or less, a money market or short-term bond fund may fill the bill.

 If your time horizon falls between three and seven years, you want to focus on bond funds.

 For long-term goals, seven or more years down the road, stock funds are probably your main ticket.

But time horizon isn’t the only issue. Your tax bracket, for example, is another important consideration in fund selection. (See Chapter 10 for more about taxes.) Other variables are goal specific, so take a closer look at the goals themselves.