The term “investment” can mean different things to different people. What does investment mean to you?
For you, it might mean “making my money grow” or “getting a decent income from my capital”. While these may seem like simple concepts, the current low-interest rate environment could render the achievement of an investment return that meets your expectations more challenging.
Even in an economy with higher interest rates, such as those seen during the 1980s, the impact of tax and high inflation can also work against savers, combining to diminish the buying power of cash. Regardless of the wider economic backdrop, generating good investment returns has never been simple.
Helping you achieve your goals
With so many complex and uncertain variables out there with the potential to knock your investments off track and jeopardise your objectives, it’s wise to seek guidance from a qualified professional. That way, you’ll understand the “bigger picture” and have the best chance of achieving your investment objectives. Before selecting an investment strategy or product to help you meet your goals, you’ll typically need to work through a number of preliminary steps. The idea of taking a slower and more considered approach is that it will help ensure the investments you select are the best suited to your personal situation.
The value of investments and any income from them can fall as well as rise and you may not get back the original amount invested.
Setting your investment objective
Identifying your goals is the key starting point for your investment plan. As with any journey, you can only plan your route map after you have decided upon your destination. For example, you might be aiming to build up a capital sum that you can access at a predetermined point in the future, or to produce a certain level of income after a set period of time. Thinking about your goals (there may be more than one) will influence your investment strategy.
If you think the objectives you’ve set are likely to change, it’s important to be clear about this up front. It then makes it much easier for us to build an appropriate level of flexibility into our recommendation. Once we have agreed on your objectives, it is advisable to stick to them unless circumstances force you to rethink. While altering your destination mid-journey may not cause problems, you could find that you have been heading in completely the wrong direction, wasting time and money.