Setting Your Money Goals

3 Factors which determine your investment strategy

You may be wondering what’s the proper investment strategy for you, but without knowing anything about you, any advice on which investments are right for you’ll actually be the incorrect ones. There are basically three factors that determine which are the proper investments for you, they are:

1. Your age

2. Purpose for the cash

3. Your risk profile

Starting together with your age. it might be rather silly of you to take a position all of your money in growth funds if you’re aged 65 because if the market takes a dive like was the case during the 1987 sharemarket crash and to a lesser extent, the worldwide Financial Crisis during the first 2000s you’ve got less time to get over these setbacks whereas the young ones have time on their side.

The purpose for the cash is that the second factor.

Decide whether you need the cash within the short-term, medium-term, or long-term.

Short-term would be up to a year.

Medium-term is 1-5 years

Long-term is longer than five years

Short term expenses would be, a checking account for emergencies, a vacation within a year, dental expenses, or t buy the youngsters schooling for a year.

Medium-term would be savings for a car.

Long term would be your old-age pension , saving for a house deposit, or saving for the trip of a lifetime.

Your risk profile may be a determining think about where you invest your money. If the thought of the sharemarket taking a dive will offer you sleepless nights then investing growth stocks within the sharemarket isn’t for you. a far better option would be managed funds where you’ll tend a choice between growth, balanced, and conservative funds.

It is important to not get into debt for there’s a price to debt which is interest. Interest adds to the value of products bought with borrowed money, and this adds up to a fortune during a lifetime of borrowing for consumables. this is often called debt because the worth of the item declines over time.

There is such a thing nearly as good debt though and this is often often your first home because the worth of the property increases during the lifetime of the loan but even this is not always an honest option for a few people if you reside a sort of transient lifestyle.

“Everyone is to their own,” so only you recognize what causes you to tick so your personal circumstances are the determining factors which govern where best to take a position your savings.

You must do your homework before you invest in anything, whether that’s the sharemarket, managed funds, or gold. there’s such a lot information available on almost everything, which includes finance. it’s just a matter of learning the ropes and having a financial strategy which suits your personal circumstances.

Most people are ready to economize but having goals and selecting the proper investments for your savings can help increase your assets and enable you to succeed in your goals quicker. In life one size doesn’t fit all as far as deciding where to take a position your money. My site has several finance related articles, visit: http://www.robertastewart.com