Four Steps to Reaching Your Goals
Please note this blog post was published over 12 months ago and so may not include the most up-to-date information, for example where regulation around investing has changed.
If you’re investing your hard-earned money, you probably have an end-goal in mind. Whether it’s to provide an income for your retirement or to save for a house deposit, your goal is what drives you to invest. Yet, with the best of intentions, we can all get side-tracked on the journey towards our goals – so how do you make sure you stay on course?
Reaching your goals takes planning, perseverance and continuous monitoring. It’s about developing good habits and removing bad ones. Here are four steps to help your reach your investment goals.
Setting the right goals
Setting a goal is the most important part of investing. A goal is the reason you save your money – it’s the destination at the end of your journey. Like any journey, you need to know where you are going.
A common goal is providing for retirement – after all, we’re all going to get there! It’s vital that your investment goal takes account of the big picture – what’s the most important thing you need to invest for? Your goal needs to be realistic and clear too, otherwise you’ll lose the motivation you need to keep driving towards it.
Set your goal in today’s money and factor in inflation. You can’t know exactly what inflation will be over time, but better to start today while you have time.
Understand your attitude to risk
Your attitude to risk is a personal choice that you need to spend time considering.
It’s important that you consider your timescale when deciding how much risk you are willing to take – how long have you got before you need to reach your goal? If in doubt, be cautious. You may need to invest more with this strategy, but better to do that and reach your goal early than taking on more risk that you are really comfortable with.
Monitor your progress
Investment isn’t as simple as setting a goal and putting some money away– you need to check your investments perform as they should. Long-term investments work best when you monitor them and you’ll soon find it is a useful habit to develop.
Regular monitoring allows you to understand your investments and see how they react in volatile times. That doesn’t mean you need to make quick decisions, being informed and reminding yourself of your investment goal (either long-term or short) is often enough. The more you know your investments, the better placed you are to make decisions about reaching your goals.
Take chances to top up
If you’re monitoring your investments regularly, you’ll know when you’re falling behind your target. Not every journey goes to plan and investing is no different. The key is spotting when you’re behind and taking action to top-up your investment.
Creating an investment habit isn’t as hard as you might think. All you need to do is recognise your bad spending habits, like buying another coffee you don’t need, and turn them in to good investment habits. Train yourself to understand your buying decisions and ask yourself if the money would be better added to your investment.
We’ve made topping-up your investment on-the-go simple by introducing impulseSave® . With impulseSave® you can add as little as £1 to your investment via your smartphone, tablet, computer or even your smartwatch. Habits are best formed when they are easy to accomplish and with impulseSave® you have the means in your pocket! And now, you can also schedule an impulseSave® so that you never miss an opportunity to grow your investment.
If you follow these four principles, you’ll be in better shape to make the most of your investments. By setting clear goals, and keeping an eye on your progress, you’ll be able to see when you’re on track – and when you’re falling behind. Add to that the habit of saving whenever you can, whatever you can, and you’ve got a recipe for reaching your goals.Create a Goal