It’s well understood that effective financial planning is crucial in order to achieve our desired goals. Therefore, it’s important to understand the basic principles of investing to create and manage an investment plan.


Your Personal Investment goals:

An initial step is to determine what you want to accomplish with your money and when you want to achieve it.

Once you have determined your goals, you need to establish your tolerance to investment risk, as well as your timeframe, ensuring you keep yourself accountable.


Investment risk:

Investment risk refers to the fluctuation in returns that you are prepared to accept.

Risk and return are directly related. The higher the level of risk you are prepared to accept, the higher the potential return from the investment. Conversely, this higher level of risk will also increase your chances of incurring a loss in the short term.

A Financial Adviser can help you determine the type of investments that are compatible with your risk profile.



Spreading your money across asset classes is the simplest way to reduce risk. Investments perform differently under various market conditions, so diversification is integral to your overall financial Plan.



Investment timeframe:

This is the amount of time you have to meet your goals. The number of years you have available will affect your investment decisions.



There will likely be adjustments needed over time as your life circumstances change and this is completely normal. Aim to keep yourself accountable but remain flexible as life evolves.


Keep to Your Plan:

Your investment strategy should incorporate all aspects of your personal finances over the short, medium and long term. It is important to visit your strategy regularly (at least, once per year) to ensure the greatest chance of achieving your financial goals.



Seeking professional advice can help you to understand investment theories and create a plan for the future.

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