I am 40 and married with 2 children. How Aggressively Should I Invest My Money Right Now and Should I Own Crypto? Here’s what 5 financial advisors have now told him. – Market observation | Eurica Project

Should crypto be a part of your overall investment strategy?

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Question: I’m 40, married, have two children and work. I wonder how aggressively I should invest in the market if I want to quit my job a little earlier. What should my portfolio diversity look like right now and should I invest in crypto?

Answers: How aggressively someone should invest in the market depends on a variety of factors, such as risk taking. “Being more aggressive with your investments can mean taking on more risks that you may or may not be able to take,” says Jay Zigmont, a certified financial planner at Live, Learn, Plan. (This tool can help you find a consultant that fits your needs.)

But taking calculated risks may be what you need to do if you’re looking to quit your job anytime soon. “That means you may need to be more aggressive in your asset allocation. The term for this in the investing world is ‘There is no alternative’ (TINA),” says Matthew Jenkins, chartered financial adviser at Noble Hill Planning, who adds that “increasing your savings rate is also paramount.” In your case, your savings rate may need to go well beyond the 10-15% traditionally recommended.

Do you have an investment question? Email picks@marketwatch.com and we’ll ask a panel of CFPs to answer the question for you.

So what might it look like for a 40-year-old who wants to stop working in 10 or 15 years? First, think about what you want your after-work lifestyle to be like. Depending on how lavish or humble you are, pros say you want to aim to have between 60% and 100% of your preretirement income to spend each year of retirement. You can also include Social Security when you start doing this, and don’t forget to factor in healthcare costs. Since you’re hoping to quit work sooner, you should expect to be withdrawing 2-3% per year instead of 4% per year.

And, says certified financial planner Lei Deng, you should flesh out all of your goals to solidify those numbers. Ask yourself things like, “At what age are you thinking about retiring?” How much money do you expect to spend when you retire? What is a rough estimate of your life expectancy? These questions can help you answer how much money you’ll need when you retire,” she says.

Should you consult a financial advisor to help with investing?

When it comes to how to invest your money to achieve these goals, many people turn to a financial planner to help them – this tool can help you find an advisor that might meet your needs – albeit with a cost connected is. This may depend on how comfortable you are doing it yourself and whether you are comfortable outsourcing financial decisions to others. Here’s a guide on what to ask of any consultant you might hire, and what to expect from a consultant (but note that many consultant fees are negotiable).

If you do decide to make your own investment choices, you may find this guide to diversification and this guide to investing if you are considering early retirement helpful, which emphasize diversification and low-cost funds as keys to success. “Diversify across sectors, add 15 to 20 years, and you could have a nice income-generating portfolio when you retire and keep up with inflation,” says certified financial planner John Piershale of John Piershale Wealth Management , adding that you should have high-quality, dividend-paying, blue-chip stocks with a history of growing dividends in your portfolio.

Should crypto be part of your investment strategy?

Many advisors say that most, if not all, portfolios should include some alternative investments. “The 60/40 reverse convertible portfolio has been under pressure lately, and adding alternative investments is a good idea when it comes to diversification,” said Josh Chamberlain, board-certified financial planner at Chamberlain Financial Advisors. But beware of investing in assets you don’t understand, and the portion of your portfolio that you invest in alternative assets doesn’t have to include crypto, although it could. Just keep in mind that cryptos “boosts and busts can cause dizziness,” says Chamberlain.

Asking yourself what’s attractive about crypto, what the goal of crypto in your portfolio is, and whether it’s for diversification or return potential can help you decide if you should invest in it. “If you’re a big believer in crypto and already have a good portfolio to help you reach your goal, you can allocate a small portion to crypto at your convenience,” says Deng. Ultimately, crypto can be a wild ride. “There’s money to be made, but you need to do your homework and make sure ice water flows through your veins. There will be many ups and downs in the future,” says Jenkins. (This tool can help you find a consultant that fits your needs.)

Don’t forget to include taxes

Other things to consider are a tax plan and where to save money. “If you’re withdrawing money from retirement accounts before age 55, you have very little chance of avoiding the 10% penalty and taxes,” says certified financial planner Blaine Thiederman. So you will also want money in non-retirement accounts like a brokerage account. “The reason is that if you want to withdraw from these accounts well before normal retirement age, you don’t have to pay a withdrawal penalty and you can still benefit from some tax-saving techniques,” says Thiederman.

Do you have an investment question? Email picks@marketwatch.com and we’ll ask a panel of CFPs to answer the question for you.

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