Whether you’re approaching retirement or just beginning to evaluate how you’d like to invest your finances, there are actions you can take now to help ensure you’re making the best decisions for your future. At their core, that is what investments are—decisions you make in the short term that are designed to grow to benefit you in the long term. Here are a few steps you can take to help make those decisions more worthwhile.
1. Always Consider Your Goals
We’re not speaking of a goal in terms of dollars and cents here. Rather, we mean painting a picture of the life you’d like to live based on your current financial situation and desired lifestyle. Would you like to have more stability in the future? What are your wants vs. your needs? How do you foresee your financial needs evolving over time?
For those who are only beginning to consider these types of questions, what’s important is to realize that as your needs and priorities change, your financial goals will as well. This will consequently trickle down to your wealth management and investment plan. So long as you consistently weigh your financial options in the context of your individual goals, you’ll likely be on the right path to helping achieve them.
2. Understand the Ways to Invest
Oftentimes, we get caught up in a few misconceptions around investing. These vary from its perceived difficulty and complexity to the notion that a 401(k) is the only type of investment plan that’s necessary. Few people consider the many options that are available to streamline and simplify the investment process. These include online resources, useful tools and calculators, among others.
For those with less digital experience, it’s often more effective to get in touch with a financial advisor to field questions, gain insight into investment options, and address any concerns prior to making any changes or adjustments. That way, you’ve got some additional context around which to build your financial path.
3. Understand the Types of Investments
Another common misconception with investing is that you need knowledge of individual stocks and to make minute trades to ascertain any sort of value. In most cases, the average investor does not need to pore over stocks or review any complicated market trend reports. A financial advisor who recommends otherwise is very likely to be less qualified and less willing to act in accordance with your best interests.
Instead, aim for a straightforward approach that makes sense to you and what you’re hoping to achieve. Ask your advisor for information on their approach to building and maintaining your portfolio, how assets will be selected, and how often you will meet to discuss changes and new investment opportunities.
4. Invest with Guidance
No matter the extent to which you’d like to be involved in your investment plan, there’s one general rule to always follow—never go it alone. The first step to choosing a financial advisor is an initial meeting and determine whether they have the expertise and an approach that A) makes sense to you and B) focuses on your goals above all else. If your goals aren’t yet defined, your advisor should work with you to determine your path and then give you the necessary tools to follow it.
Have questions about your current investment plan? Give us a call at 610-437-5650 or leave a comment below.
Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC, a registered broker-dealer and a separate non-bank affiliate of Wells Fargo & Company. Magellan Financial, Inc. is a separate entity from WFAFN.