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Rule of 42: Your Investing Blueprint for Building Wealth


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Published in Stocks and Investing on Saturday, March 22nd 2025 at 13:01 GMT by GOBankingRates   Print publication without navigation

  • One of the keys to successful investing is diversifying your portfolio so you're not too dependent on any single asset or asset class. The idea is simple: If one asset loses value due to economic

The article from MSN Money discusses the "Rule of 42," a guideline for building wealth through investing. It suggests that by age 42, one should aim to have saved enough to cover their annual expenses, thereby achieving financial independence. The rule emphasizes starting to invest early, even if it's a small amount, due to the power of compound interest. It outlines steps like setting clear financial goals, understanding your risk tolerance, diversifying investments, and regularly reviewing and adjusting your investment portfolio. The article also highlights the importance of not just saving but investing in assets that grow over time, like stocks, real estate, or retirement accounts, to outpace inflation and build substantial wealth. It encourages a disciplined approach to saving and investing, advocating for automatic savings plans and the benefits of long-term investment strategies over short-term gains.

Read the Full GOBankingRates Article at:
[ https://www.msn.com/en-ca/money/savingandinvesting/rule-of-42-your-investing-blueprint-for-building-wealth/ar-AA1oEMGa ]

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