Key Considerations of Astute Investing

For many just starting out, investing can feel daunting. But by breaking it down into the basics and aligning it with your personal goals, the process becomes far more approachable and manageable. It's important to understand that the primary reason to invest is to grow your wealth over time – ideally at a rate that outpaces inflation.

We live in an age of great uncertainty with conflicts, trade tensions, protectionism, soaring prices, increasing debt and technological shifts. All of these factors – and more – mean that financial planning and goal setting as an individual have become even more important.

Buying and selling during fearmongering or chasing trends are not always the best investing strategies. It is critical to make informed, disciplined decisions that align with your personal financial goals.

Ask Three Key Questions

There are a few critical questions that you must answer to plan astutely and to ensure that you're investing wisely.

1. What am I investing for?

• Am I saving for a home deposit?

• Do I want to fund higher education or career development?

• Am I planning for retirement?

2. How long do I plan to invest for?

Your investment timeline is closely tied to your goal. Are you investing:

• For the short term (1-3 years)?

• For the medium term (3-7 years)?

• Or for the long term (10+ years)?

Longer timelines allow for greater tolerance of market volatility and make compounding interest your best friend.

3. What is my risk tolerance?

Generally, higher risk can bring higher returns, but one also runs the risk of higher potential losses. Knowing your risk tolerance helps you to choose investments that fit your comfort level.

Plan Your Investment Strategy

Once you’ve honestly answered the key personal questions – about your goals, timeline and risk tolerance – you’re ready to move forward with your investment plan.

Start with simple, easy-to-understand investment vehicles. Investing consistently and regularly, even with small amounts, is more important than trying to time the market or to pick “perfect” investments. If you don’t understand how your investments work, you won’t be able to tell if they’re performing well or how to adjust your strategy when needed.

Be mindful of fees, costs, and taxes, as these can quietly erode your returns over time. Never overlook the impact of these underlying expenses on your portfolio’s growth.

Don’t do it Alone

It is best to get expert insight and advice on your investments by consulting a qualified financial advisor – not to hand over control, but to gain guidance, structure, and an outside perspective that keeps your plan on track.

It is also a good idea to review your portfolio at least once every year, and to adjust it as your goals, circumstances, or risk tolerance change.

At Futura, our seasoned professionals bring the expertise and insight needed to provide solid advice, guide your financial planning, and tailor solutions to your unique circumstances, helping you to secure the future that you envision.

If you’ve thoughtfully answered the basic personal questions and chosen a realistic strategy that fits your needs, you’re well on your way to becoming a confident and successful investor.