|
Investment Planning |
Steps to successful Investing
. 1. It’s a journeyIf you want to succeed you need to understand it’s not a one day wonder. You need to plan to go the distance and the power of compound interest and capital growth will do the rest. The sooner you start the easier it is on your pocket. R5 a day at age 25 will amass R797,000 by age 65. If you start 10 years later R69.50 to save the same amount! Remember that time has shown that the regular investor who plods along investing monthly amounts avoids all the pitfalls. It’s all about time in the market and not timing.
2. Find the right advisor.This is probably the most critical factor in your return. There are advisors and advisors. The highest qualified is a CFP. They have a wide general knowledge and would be able to steer you to experts in there own rights were necessary.
3. Diversify.Spread your investments across asset classes according to your risk profile. Remember the old rule of “don't put all your eggs in one basket” Diversification reduces your risk and can also potentially increase your returns.
4. Pay off debt.Generally speaking good advice when it is household debt. Gearing for property investment and rental returns should be looked at in a different light depending on the existing economic cycle.
5. Build yourself a pipeline.Unfortunately adjusting your lifestyle may be necessary. If you have nothing to give you have nothing to gain.
6. Understand the Risk.Advice risk - the risk of being misled into the wrong product. Market Risk - Share market collapse Market Sector Risk - Gold, Mining or other 7. Use ProfessionalsThe world of investment is highly specialised and complex. This is where you should employ the collective wisdom of investment professionals.
¨ Select a trusted adviser or broker. ¨ Choose your investment company carefully. ¨ Make sure the asset managers who invest your funds rank consistently among the best in the world.
8. Develop and Maintain a Clear Investment PlanWith the assistance of a qualified adviser or broker, make sure your investment objectives are clear and realistic, before you invest.
¨ Check your timelines and understand your ability to absorb investment risk. ¨ When you have developed a plan, make sure your actions are consistent with your plan.
9. Resist Impulsive DecisionsIn highly changeable investment markets, impulsive behavior is understandable. But hasty decision making is not the path to sustainable investment success.
¨ Timing the market is difficult - and high risk. ¨ Consider your investments as a whole and accept that at different times, different parts of a diversified portfolio will perform better than others. ¨ View your portfolio in the light of your investment objectives.
10. Check Your Vision against RealityFrom time to time, revisit your vision and your goals.
¨ Are you on track? ¨ Are your goals still achievable or do you need to change your plan or portfolio? ¨ Have your circumstances changed? Reality checks are essential to successful investing, so review your plan regularly with your adviser or broker, at least every year
|
|
To contact us: |
|
|
