Setting Investment Goals

Posted on: 10 Jan, 19

Creating and maintaining the right investment strategy plays a vital role in securing your financial future. How much control do you want over your investments? Do you prefer to be in charge, or do you want someone to invest for you? Volatile markets can test your nerves. We can advise you on solutions to help you meet your investment goals so that you weather the markets by keeping your portfolio diverse. So what do you need to consider?

Timescale

Probably the first question you should ask in setting your investment goals is, ‘What is my time horizon?’ In other words, when will you need the money? Are you investing for your young child’s school or university education, or for your retirement 30 years in the future? Or do you hope to achieve your goal in a shorter time frame? For example, do you want to buy a property in three years, or start your own business in five years? Your timescale for a particular financial goal will have a significant impact on the type of investments you choose to try to achieve it.

The general rule is: the longer your time horizon, the riskier (and potentially more lucrative) investments you can make. The longer the timescale, the more opportunity you have to ride out any fluctuations in your investments. On the other hand, if your timescale is very short, you may want to concentrate on investments that may offer a lower return but also greater reassurance about whether the money will be there when you need it, because a shorter time frame may not give you enough time to try to recoup any losses.

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