Your financial goals will keep changing as you go through life. You will need to plan for retirement, fund your kids through college, buy a new house or even upgrade to a bigger home. Whatever your personal goals, the fact remains that you need to save and invest your money into a customised mix of various investments to meet these goals.
SMART ways to invest!
S for Specific
- Why are you investing? What do you plan to do with the profit?
- Do you want capital gain or income (dividend, rental for cash flows)?
M for Measurable
- Is your investment over/underperforming? How volatile is it?
- How much of fees are you paying (commission, management fees etc) & are they eating into your return over the long run?
- Are there any comparable opportunities with similar / higher return but lower risk & cost?
A for Achievable
- Can the investment statistically give me the returns I want, within my expected time horizon?
R for Realistic
- Is the investment guaranteeing a very high return within a short period of time?
- Are you taking too much risk or putting all your money into a single investment such that you cannot sleep if that investment turned sour?
T for Timely
- When do you need to exit the investment?
- Are you getting the latest update of the investment to monitor its performance?
- Are you able to DIY your investment while busy juggling with family, health, career / business?