There was a time not too long ago when managing your investments was not that difficult. Most consumers wanted to have enough money to live on in their Golden years and some were also interested in paying for college tuition for their children. But the process was all the same. You had a pension fund from your employer, a savings account and maybe a few shares of this or that stock that your investment banker pointed out to you. You invested as you had the spare cash and then you sat back and let time, compounded interest and the growing economy do the rest. But today, pension funds are almost nonexistent, savings accounts literally offer a penny on the dollar if you can find a good one and even your investment in your home is not a sure thing to provide a good return on investment. So investors are left floundering in a sea of questionable options and schemes that are just as likely to help you go broke as they are to help you get rich. They don’t understand the new process or the concept of managing my investments for my future.
Today’s Secret Ingredient
Many consumers have no idea what it is going to take to grow their current wealth and have a comfortable life after they retire. They are still in the mindset of generations past; they want to pass the responsibility off to an investor, broker or banker who will shake their hand and assure them that everything will be ok. Just come back to the bank and you will find a big pile of money waiting for you. This is a fairy tale and one that does not have a happy ending. The secret to financial security now lies in taking an active role in the process and being proactive. It is harder now to grow your money and it is not something that you should leave to someone else’s hand. Your lack of attention to detail now or even lack of any attention will only leave you struggling to survive on meager Social Security checks in the future.
Only You Can Envision Your Path
Lifestyles have changed over the past few decades. Not everyone is eagerly awaiting the day that they can retire and live out the rest of their days in their paid off family home in the suburbs. Some retirees are looking at extensive travel, others want to move to be closer to grandchildren or to live in a more mild climate and still, others plan on reinventing themselves and starting a new career or business. But no one else can see your vision, therefore, no one else will be able to plan a strategy to finance the vision. You, on the other hand, have a clear image of what you want, where you want to live and also a good idea of how you plan to get there. So it is up to you to take the next step to bring your dream to reality.
Find the Knowledge
The Internet is an amazing tool that has many uses and one of them is finding useful information and getting a broad knowledge about a topic. That is not to say that every word is true but you can read from a variety of sources and pretty much whittle down to the truth and toss out the crazy scam artists. So use this tool to begin to educate yourself on the financial options that are available. You can do the research, learn the basics and begin to create a blueprint on how you will build your financial future and how you will make your dreams become your future.
Do the Research
Once you have a foundation knowledge of investing in today’s world, then you can begin to look for an advisor or investment banker to work with. It is very easy to request information that will show you their track record and also the type of investments that they favor. You can sit down and explain where you want to be in retirement and how you plan to get there. Giving your advisor a map to follow and showing where you expect to be in 5, 10 and 15 years sets the expectation that you will be monitoring the progress of your finances on a regular basis. It also will dictate the level of the conversations that you will have with your investor. Knowing that you have done research and know a bit about the investment process, your investor will speak in a more technical manner and provide you with more details. They will welcome you into the decision-making process about your investments and should also appreciate the fact that you will be taking an active role in the growth of your wealth. It is easier for an investment advisor to work with some input and helps that you will be keeping an eye on the status and not just waiting for his call in ten years.
Don’t Get Lazy
As the months roll past and you are seeing a solid increase in your portfolio, don’t get lulled into complacency. You might go for months with no real change in the account activity and feel that you can let loose of the reins a little bit. But nothing could be further from the truth. Economic conditions change quickly in today’s political climate. A calm sea today could be raging tomorrow and your risk to reward could change drastically. You are the only one with a vested interest in the growth of your wealth and only you can decide when to make a change. Watching closely will allow you to make changes when a shift first occurs and will help to decrease your chances of a huge loss over a week or month. When you hire someone to build a house for you, you monitor the progress to be sure that it is the house that you want. You need to have the same mindset when you select someone to build your financial future for you. You will have the confidence and security of knowing that I am managing my investments and I know what my future will look like.