How To Build an Investment Plan

Creating a good investment plan requires that you know why you are investing. Understanding your purpose will help you narrow down the choices for which path will most likely help you reach your goal. The Blisk Financial Group offers investment planning McLean and in Charleston, SC.

Here are five steps for creating a sound investment plan.

Determine Your Purpose

What is your goal? Investments must be chosen based on your main goal.

Do you want safety, growth or income? Do you need growth so that the investments provide income later? Or maybe safety is your main priority?

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Know How Much You Can Invest

Let’s be realistic here. Before you can make an investment plan, you have to decide how much you can invest. Our group has worked with families for generations to offer investment planning McLean. Most investment opportunities have a minimum investment amount, so your finances really matter. Will you be making monthly contributions, or do you wish to invest a large sum at once?

Investing monthly is called dollar-cost-averaging. You can open an account with as little as 3,000 dollars and then transfer a monthly contribution to the account. This option helps reduce market risk.

There are more choices available for large sum investments. To minimize risk, you should choose a variety of investments. It is important to know how much you should put into stocks vs. bonds and also to know whether you need a financial advisor.

[Related: Investment Management vs. Financial Planning]

Establish A Time Frame

When will you need to use this money? If you need the money to purchase a home in a few years, your investment plan will differ than if you were saving for retirement in 40 years.

Your choices should be based on which investment is more likely to give you an account worth the most money by the time you need it.

Read about tips for Early Retirement here.

Choose A Risk Level

It is important to determine what level of risk you can take. There is no such thing as high reward with low risk. Some investments are so risky that you could lose all of your money. This is too much risk for most investors.

The easiest way to lower the risk is to diversify your investments. This can reduce the risks of complete loss, whether due to circumstance or poor timing. It’s much better to earn a moderate return that to risk losing it all.

Choose What to Invest In

Start by creating a list of available options that fit with your end goal. Do your research and make sure you understand the pros and cons of each option. Which options do you feel confident with? This will help you narrow down your choices.

Investment Planning McLean

If you are ready to begin your journey in investing, don’t wait. Contact Blisk Financial Group and let us help with your investing needs.

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