Do You Have An Investment Strategy?
Each of us has special needs and objectives we want to accomplish. And when it comes to building a secure future, we need to look at our investments as the vehicle that will get us to our goals. Every investor has the capability to use their knowledge and expertise to develop an investment strategy that will protect them well into the future.
Your eventual goals as an investor should really be fourfold: Cash flow, income, appreciation and financial security. However, while many of us are at different levels in our quest to reach these goals, each of us realizes that we must do something now in order to secure a financial future for ourselves and our families. After all, isn't that why we became investors in the first place?
To help you develop an investment strategy - in case you haven't already done so - here are seven (7) questions you need to answer for yourself as to what your investment strategy should be. In doing so, be sure to take into consideration both your family needs as well as your outside interests as you answer these questions.
1. What is your present financial situation? Are you gainfully employed? An entrepreneur or a retiree? And does your present income cover all of your expenses? It is most important that you answer these questions with total honesty.
2. What are the financial goals/obligations you must meet before you retire? Are you taking care of an elderly parent? Do you have children that you plan to put through college? Are you helping to support a married child with a family? These are real situations that just won't go away so you need to allow for them. After all, this may be how you are spending your money at the moment, so where does that leave you in terms of planning for the wealth accumulation you will need to fund your retirement?
3. How much investment capital do you need if you are just starting an investment program or, how much do you need to keep your existing investment program going?
4. How many years are left until you intend to live off your retirement income? It is very important to be realistic in answering this question.
5. What annual income will you need in order to retire comfortably? A good estimate is to figure 70% of your current income.
6. How many years do you expect this income to last? This is not an easy question to answer. Perhaps you can use your family history as a guide.
7. How much investment risk are you willing to take today, to accomplish your goals in the future? This is one of the most important questions that you need to answer for yourself because many of us are really not risk takers. Many people leave money sitting in a bank savings account or in a money market fund because they are afraid they will lose it. So the answer to this question will determine just what risk you are willing to take in order to achieve your goals.
So what exactly is your ticket to retirement? Any expertise that you acquire through your investing activities can be used to compound your wealth. And one of the best vehicles for doing that is to have a self-directed retirement plan where the plan administrator or custodian allows you, the IRA owner, to acquire the kinds of investments in that plan with which you have had the most success as an investor. And this can mean moving beyond stocks and bonds or mutual funds to include things like rental properties, timberland, or even businesses for example.
To learn more about this subject, you can go to "IRA-PLUS" in our Links listing.
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Your eventual goals as an investor should really be fourfold: Cash flow, income, appreciation and financial security. However, while many of us are at different levels in our quest to reach these goals, each of us realizes that we must do something now in order to secure a financial future for ourselves and our families. After all, isn't that why we became investors in the first place?
To help you develop an investment strategy - in case you haven't already done so - here are seven (7) questions you need to answer for yourself as to what your investment strategy should be. In doing so, be sure to take into consideration both your family needs as well as your outside interests as you answer these questions.
1. What is your present financial situation? Are you gainfully employed? An entrepreneur or a retiree? And does your present income cover all of your expenses? It is most important that you answer these questions with total honesty.
2. What are the financial goals/obligations you must meet before you retire? Are you taking care of an elderly parent? Do you have children that you plan to put through college? Are you helping to support a married child with a family? These are real situations that just won't go away so you need to allow for them. After all, this may be how you are spending your money at the moment, so where does that leave you in terms of planning for the wealth accumulation you will need to fund your retirement?
3. How much investment capital do you need if you are just starting an investment program or, how much do you need to keep your existing investment program going?
4. How many years are left until you intend to live off your retirement income? It is very important to be realistic in answering this question.
5. What annual income will you need in order to retire comfortably? A good estimate is to figure 70% of your current income.
6. How many years do you expect this income to last? This is not an easy question to answer. Perhaps you can use your family history as a guide.
7. How much investment risk are you willing to take today, to accomplish your goals in the future? This is one of the most important questions that you need to answer for yourself because many of us are really not risk takers. Many people leave money sitting in a bank savings account or in a money market fund because they are afraid they will lose it. So the answer to this question will determine just what risk you are willing to take in order to achieve your goals.
So what exactly is your ticket to retirement? Any expertise that you acquire through your investing activities can be used to compound your wealth. And one of the best vehicles for doing that is to have a self-directed retirement plan where the plan administrator or custodian allows you, the IRA owner, to acquire the kinds of investments in that plan with which you have had the most success as an investor. And this can mean moving beyond stocks and bonds or mutual funds to include things like rental properties, timberland, or even businesses for example.
To learn more about this subject, you can go to "IRA-PLUS" in our Links listing.
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posted by Bob Moser at
4:39 PM
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