How to Choose an Investment Plan That Works Perfectly for You

How to Choose an Investment Plan That Works Perfectly for You

In this day and age, the picture of financial security is no longer a stable job. First of all, because there is no such thing as a stable job and second because there is not a job in the world that can meet all your needs (financial freedom and security). That being said, be sensible, do not quit your day job until your investment has really started bringing in reliable returns.

To ensure this you need to choose a good investment plan. There are several of investment vehicles in Singapore to choose from; bonds, unit trusts, shares, traded life policies, investment-linked insurance policies and so much more. Whatever vehicle you choose, make a plan that works perfectly for you.

Notice that the choice depends on you, so do not choose a plan based on another’s success or failure. You need to be really honest with yourself and your advisor in order to make a perfect investment plan. So, here is what you need to consider:

What kind of investor would you like to be?

This is based on your personality (we do not need you developing an anxiety disorder because of your investment plan) and your possibilities. If you are a daredevil, you will probably go for high risk investment plan and the opposite is true for you sure-footed types. Beyond your personality, consider the practicality of your possibility i.e.

  • How much do you make and spend per month?
  • How much do you have in savings?
  • What do your insurance policies look like?
  • How close are you to retirement?

All these will help you determine how close to the edge you can get as far as risk is concerned.

What are your goals?

Where are you now financially? Where would you like to be? When would you like to get there? The answer to these questions is usually affected by several of the factors mentioned above as well.

If you are younger (further from retirement), your focus may be building capital so you may be inclined to take bigger risks that bring in higher returns. An older investor may have the capital but want to go low-risk for predictable returns.

Stay focused

No matter how exciting other prospects may appear, avoid making choices based on the latest exciting trends in your market. Stick to your original plan and please listen to your investment advisor.

These may appear very simplistic but are guaranteed steps to a perfect investment plan for you and your future financial freedom.