Friday, January 28, 2022, 1:22 PM
Nils Larsen manager of financial portfolios explains how to set investment goals.
LOS ANGELES, CA / JAN. 28, 2022 / Setting investment goals is an essential part of the investment process, according to Nils Larsen manager of financial portfolios.
“We develop financial goals very early in our lives, and those goals transform as we age,” Nils Larsen said. “The goal to purchase a car may transform into the goal to purchase a house, and eventually a goal to retire comfortably. Investment goals set the foundation for all of your investment decisions.”
Defining Investment Goals
The first step in setting obtainable investment goals is to define what those goals are.
The following are a few examples of common investment goals:
- Planning for a family
- Saving for education
- Creating an emergency fund
- Planning for major life vents (a major vacation, wedding, etc.)
- Planning for retirement
Retirement is one of the most common investment goals. Investors to create a comfortable retirement fund are encouraged to start investing as much money as possible as early as possible.
The SMART Qualities Test
Experts like Nils Larsen manager suggest passing financial goals through the “SMART” qualities test before setting them in stone.
- Specific: Investors need to focus on one or a few clear goals instead of a large, general goal.
- Measurable: Progress in reaching the goal is easily traced and recorded.
- Achievable: The goal should be within reach.
- Realistic: An investment goal should be achievable given the individual’s current financial situation.
- Time-based: Every investment goal should include a timeline for completion.
Create a Strategy
One of the most important aspects of setting investment goals is to create a viable strategy. An experienced financial portfolio manager can help you create a strategy that will help you reach your goals on time.
Financial experts use several common strategies to help individuals achieve their goals.
Financial Growth
Financial growth is a common investment goal. Individuals with short investment timelines need to use different investment strategies to achieve growth than individuals with longer investment timelines.
Wealth Preservation
Individuals who have already acquired wealth often want to focus on preserving that wealth for their future or future generations.
Maintaining a Lifestyle or Improving It
Individuals often seek the help of a financial professional to improve or maintain a certain style of living. Some are happy with the material items and assets they have, while others are seeking help to lead a bigger, better, or even more relaxed lifestyle.
Determine Short and Long-Term Goals
Not all investment goals are treated the same. A financial portfolio manager will help investors determine goals that are possible to achieve in the short term and others that will take longer.
A common short-term goal is to create an emergency savings fund, while a common long-term goal is to save for a child’s college education or personal retirement.
Nils Larsen Manager of Financial Portfolios
Nils Larsen is a financial portfolio manager with decades of experience in the industry. His expertise in risk tolerance, goal setting, and other aspects of investing has helped countless individuals and families reach their financial goals.