Getting into the right mindset for your investment strategy

9 Feb 2017
Learning to invest is something anyone can do. It often takes some time, research and even practice but it’s well worth it in the long-term. Having said that, however, it’s vital to have the right mindset to invest and to have the patience to wait sometimes a very long time for returns.

When it comes to investments, you have to strategize, plan and build over the years. Here are a couple of things to help you get into the right mindset for your investment strategy:


Think about goals for your money

You need to think about the reasons that you want an investment strategy. Why do you want to invest your money?  Is it because you want to retire at a certain age, or travel the world later down the line? Perhaps you are saving for your family’s future? Whatever the reasons, make sure you have some clear (and realistic) goals to focus on. Write these goals down, because there is a popular belief that if your goal is written down, you have more chance of achieving it.


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Figure out a time frame


When it comes to an investment strategy, it’s important to have a time frame. Once you have goals and focus for your investment strategy, and you have decided on a time frame, then you can determine whether your investment strategy is realistic. You can also gauge how much risk you can take. The general rule here is that the longer you have, the more time risk you can take. Here are the three main timeframes to keep in mind:


  • Short-term goals (under five years). Good investment options include money markets and other cash savings accounts.

  • Medium-term goals (five to ten years). Consider investing in property or stocks.

  • Long-term goals (ten plus). Any investment is generally good for long-term goals. But remember that nothing when it comes to investments is guaranteed.


Decide how much risk you are willing to take


When it comes to your investment strategy, the level of risk you are willing to take is completely personal. There is something to be said for being cautious, but it’s important that you understand that often with higher risks come bigger rewards. Perhaps it may be an idea to employ the help of an expert, who can help you make the best possible returns with calculated actions and risks. The risk factor, and how much risk you are willing to take, depends largely on how much of an impact it would have on your life (and lifestyle) if your investments fell.


Calculate how much you can afford to invest


One of the main things that you need to decide when planning your investment strategy is how much can you afford to put into your investments? The best way to calculate this is to create a budget that includes all your monthly expenses from car payments to school fees. Once you have done that, see how much money you have at the end to invest. Even if it’s a little bit at first, this can mean a lot in the long-term, and you can always add to it as your income grows.


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Consider hiring a financial advisor


Figuring out your investment strategy is no walk in the park and in fact, unless you are a finance professional yourself, it would probably be wise to hire a financial advisor to help with this daunting task. Keep in mind, the earlier you start investing the better.


Would you like more information on creating the best investment strategy for you? You can contact us for any property-related investment advice. We, at Grupo Esmeralda, have an array of incredible Calpe apartments that would make the ideal addition to your diversified investment portfolio.


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