3 Strategies To Help You Meet Your Financial Goals

To build wealth you need to get the real return that you need to meet your goals. If you have done a capital needs analysis to figure out what rate of return you will need on your money to meet your future income goals, you may be panicking right now because you aren’t getting the returns you need because of the economic downturn, or maybe you panicked and sold positions and have large losses and feel like you will never get ahead. Let me address both.

All of us have learned that you must invest for the long term. Long term is now longer than 5 years. There will always be short term (3 years or less) swings in the market down and up and I am asking you to ignore that. I want you to focus on the return you need to meet your goals. Coming up short? Well you have a couple of options.

1.) Change your contribution level. Add more money gradually over time to make up the shortfall. This may mean more monthly contributions to savings or retirement plans or it may mean just putting all of your bonus or extra savings into equities to meet your goal.

2.) Change your timing. Let’s say you are coming up short including additional money contributed. Let’s say your goal was to stop working entirely at 65. You may have to change that to 67 or you may have to work part-time for a couple of years after 65 to make up the short fall. That’s really not that hard when you look at the big picture.

3.)  Change your goal. Let’s say you wanted to stop working to be able to live on 70% of your salary now. If you change your goal to 60%, you may still be able to stop working in the year that you set your original time goal.

So don’t freak out that you may have to work the rest of your life because you are only getting 4% return on your investments. Think long term, think about your options above, run the numbers and you will find that you all have a lot of great options available to still meet your goals.

Investing to meet your goals is wise. Investing to beat the markets is foolish. Don’t gamble with your hard earned money. Just like saving for your future, you need to keep investing for your future,  no matter what the markets are doing.

About the author

Fern Alix LaRocca CFP® EA

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