Investing goals | Image Resource: finra.org A different approach to wealth management is goal-based investing which focuses on helping you achieve certain life goals. Your life goals may be saving for your child’s higher education, building a retirement corpus and more.
Goal-based investing does not involve generating the highest-ever portfolio return or timing the market. It differs from traditional investing and helps the investors to achieve their life goals rather than focus on how well the investments perform. In retirement, the goal is to get the replacement income and for this, you should build the right portfolio. Your portfolio should secure your investing goals which are different from just achieving nominal retirement savings. You want to achieve a target replacement income. You should follow a risk-controlled investment approach and use strategies to reach your targeted income. You should start saving as early as possible so that your money gets time to grow. You should calculate your net worth on a regular basis to check if you are on the right track. You should also take the investment fees into consideration, as they can bring your final amount down. Tips for retirement investing You can save for your retirement using tax-advantaged or taxable accounts. In a tax-advantaged account, you need not pay taxes on your earnings from the investments. Income tax is applicable only when you withdraw your money during retirement. Taxable accounts do not offer any type of tax break. There are many reasons for starting to invest early. First is that you will get the benefit of the power of compounding, saving and investing will become a habit, you will get more time to recover from any losses, you can go for higher risk and higher return investments, and you will have more years to save and thus get more money at retirement. You should calculate your net worth which is how much you own and what are your liabilities. Subtract the value of the liabilities from the value of your assets to get where you stand right now for your retirement. This will help you to understand where you are heading. You should not let your emotions influence your investment decisions. For example, if your investment performs well then you may get confident and underestimate the risk. You make a bad decision and lose the money. Fear can make you sell investments that could turn around and continue to grow. Rather than reacting, take time to evaluate your investments.
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Young gym instructor from Jabalpur, Shanaya Tripathi, blogs to ensure an added income for herself. She is athletic and has hiked many times. Her other hobbies include shopping and teaching. Shanaya’s blog is an interesting mix of several topics such as online gaming, educational courses, custom bench cushions, vehicle tracking systems among others. She blogs in a very simple language so that readers can understand and relate to the topics easily. Her posts about multiple vocational courses available can simplify your career choices. Comment on the posts you like and share your views. Your feedback will help her improve writing skills.
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