• Finance – Savings investment principles

    We all dream of being financially independent, retire comfortably, provide to all our family’s wants and needs, and even spoil ourselves from time to time. Achieving these goals requires proper financial planning, and the first step is saving.

    Most of us don’t save enough to be able to achieve our financial goals, but by following some of the basic investment principles you can get your savings plan on track.

    The first thing to remember is that there is no quick way to riches. The most stable and profitable investments take time to grow, and if someone offers you incredible returns that sound too good to be true, then it probably is and you should avoid these scheme. Rather invest with a company that is well known in the financial services industry with a good track record.

    Investment and time go hand in hand, as it determines the risk of the investment. The longer you invest, the more risk you can take, and the more compound interest will work in your favour. Have an investment time-frame in mind, but try to keep your investment in the market for as long as you can. This is why experts advise people to start saving as early as possible.

    Keep investing regularly, even if the market is going through a slump. The habit of saving is an important one, and by continuing the habit through tough economical times, you will reap the benefits when the market recovers.

    Don’t keep all your eggs in one basket, spread your investment over different products that offer different levels of risk and returns. Spreading your investment risk over a number of products can help you through the tougher financial times, as one investment might gain when another is going through a slump.

    With the immense multitude of investment products available, choosing a portfolio that will suit your individual needs can be daunting. Use the services of a professional portfolio manager or financial advisor to assist you – their intimate knowledge of the investment landscape will be to your benefit. These professionals also regularly review your investment strategy to ensure it’s on the right path towards achieving your financial goals.

    Ultimately it’s important to remember that your financial needs are unique, and just because a certain investment works for a friend, doesn’t mean it will be ideal for you.