While for most people the single most important long-term goal by far is having financial security for retirement, many investors set other investment goals, such as financing trips, home improvements, paying for their children’s education or buying luxury goods. One additional objective that does not fall within a particular time frame is creating an emergency fund that will be constantly available for life’s unexpected twists and turns. Choosing a flexible type of investment, through savings plans for instance, allows investors to increase their regular contributions when they have more disposable income and cut back if times are more difficult.
Your age and investment profile have an enormous influence when choosing investment funds. Your needs and goals change significantly over the years. At the start of your career you may be saving for the down payment on a mortgage or car – you may not have much disposable income, but your expenditure will also probably be low. As you get older and approach the peak of your earning power, you may have a mortgage to pay off and a family to feed. As you approach retirement, your financial commitments and priorities will shift once again as the desire for regular income becomes more important than the need for strong capital growth.
As your financial situation changes it is essential that your capital investments are also adjusted to reflect your revised investment needs. Regular reviewing your investments with your financial advisor will ensure that your portfolio remains constructed in line with your circumstances and requirements.