Some Basics on Saving and Investing

If you want to begin down the road to financial freedom, you should first develop achievable saving and investing goals. You won’t regret taking the time now to create a personal investment plan.

Some things to consider:

• What are you looking to accomplish?

When it comes to investment goals, be specific. Think about timing and what your target dates are for reaching your goals and how much capital you are willing and able to invest (i.e., put at risk of loss) in order to achieve your goals.

• What is your risk tolerance?

We’ve mentioned risk before and for good reason. Investing is all about risk and where you reside on the risk tolerance spectrum. How much capital are you willing to lose? Understanding the amount of risk you are comfortable taking determines your “risk tolerance,” which will help inform your choice of investment products.

• What type of investment should I consider?

There are numerous investment products in the market (e.g., securities, commodities, digital assets) and even more people willing to sell them to you – often suggesting directly or indirectly that their product is the “right” investment for you. Be careful, ask questions, and do your homework. And remember, your investment goals are unique to you. And investment products tend to also be unique and for various reasons, including their nature and type, inherent risk profile and reward potential, time horizon to break even, and associated fees. Your goals and risk tolerance should help you decide.

• Should you go it alone or with help?

Your willingness to invest alone or to ask for help from a financial services professional, like an investment advisor or broker, will depend in part on how knowledgeable and experienced you are in investing generally and more specifically in the subject matter area that you may be considering investing in. Further, how willing are you to sort through investment choices and keep abreast of latest market developments? Investing can be complicated and investment products each come with their own risk profile often requiring some form of specialized knowledge. Many seek the help of a financial services professional and registered professionals generally have a fiduciary obligation to their clients or must act in their best interests. At a minimum, use the resources available to you to educate yourself on investing generally and more specifically the products you are considering.

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