Introduction
It is fair to say that many of our posts go into a lot of detail; for some, they might be TLDR (too long; didn't read!). This short and sweet post identifies the key topics you need to consider for the best chance of investing success.
The ten tips for investing success
1. Create your financial plan before creating your investment portfolio.
Having clear goals and objectives should help you stick with the plan during turbulent markets.
2. Don't try to beat the market.
There are some incredibly talented people in the market, and trying to outsmart the market means you are competing against these people. It's unlikely you will be the winner. It's also highly unlikely that you will have access to someone who can beat the market (although you will find no shortage of people who say they can!)
3. Try not to check your investment balances too often
Checking your portfolio balances once a year should be sufficient if you are holding a globally diversified portfolio, typically undertaken when you update your financial plan (see #1)
4. Optimise (lifetime) taxation
One key driver of retirement success is to (legally) optimise your lifetime taxation. Taxation comes in many forms, including income, inheritance, and capital gains, and it's important to evaluate these over the whole retirement period rather than looking at individual years.
5. Diversify
It's the one "free lunch" when it comes to investing! Understand each asset's role in the portfolio (e.g., defensive or growth), and schedule periodic rebalancing to ensure overall portfolio volatility remains aligned with your objectives.
6. Take the right amount of risk
Consider
How much risk do you need to take?
7. Have a cash buffer/float
Withdrawals from your retirement savings should ideally be planned for rather than on an ad-hoc basis. The cash buffer should be used to absorb fluctuations in spending.
8. Don't chase past performance
9. Don't watch too much NEWS (Negative Events World Service)
A controversial one, but we hear of many retirement plans that are derailed because someone made a decision based on what bad news they read/watched.
10. Understand that a decade is not a long time when it comes to investing.
Conclusion
All the above might seem very obvious, but we often find it's the simple things that determine retirement success.
Next steps
If you would like to discuss any of the above in more detail, please get in touch.
About us
The team at Pyrford Financial Planning are highly qualified Independent Financial Advisers based in Weybridge, Surrey. We specialise in retirement planning and provide pension advice, investment advice and inheritance tax advice.
Our office telephone number is 01932 645150.
Our office address is No 5, The Heights, Weybridge KT13 0NY.
Please note: This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.
Although best efforts are made to ensure all information is accurate, you should not rely on this blog for your personal situation or planning.
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
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