Seven investment mistakes you can easily avoid
The below points are issues Shoreline advisers sometimes come across when we take over policies from clients that were set-up in the past by other advisers. If you can avoid the below issues you will start your plan right. The saying “A job well-conceived is a job half done”, also applies to investing.
Start too high:
When you start your regular plan start with a contribution level that you can easily maintain throughout the term of the plan. If you already know in advance that you can’t maintain your high premium in the near future invest accordingly.
Invest too long:
It is easy to set-up one long-term saving plan, but it is better to have several plans with different maturity dates. These should be timed with events in your life such as education fees for your children, your personal retirement or even a short term, but high intensity goal such as a property purchase in five-ten years.
Stop too soon:
The best way to ruin plan performance is to start a long term plan on a high contribution and then stop contributing to your plan early in the term. Naturally there are circumstances beyond your control, but to get the best returns possible maintain your contribution as much as possible.
Switch investments too often:
Investment performance from the past is no guarantee for the future. We have all read that line a million times, but it is true. What happened in the past will not be replicated ever in the future in the same way. Selected an investment based on the solid long term performance potential of that sector or market and forget the short term noise.
Don’t do your homework:
Some people get swept away by a charismatic adviser and forget to do their homework. Advisers are supposed to advice you on the plan, but not all advisers have the client’s best interest at the first place unfortunately. Therefore, like with anything in life, trust but check and read the product materials your adviser gave you. If he doesn’t send you any product details and market comparisons don’t sign until you have informed yourself fully. You can always contact Shoreline for a second opinion.
If the investment adviser you work with promises you golden mountains think again, if he would be half as good as he claims he wouldn’t need your investment and would own an investment bank rather than work for one. Always be realistic.
Don’t be afraid to invest:
Sometimes clients are simply afraid to invest for reasons that are not always logical. They are convinved that they can make more money using a bank deposit or that they should not invest internationally because they don’t know the how the future rules will affect them. Time will fly by very fast and cannot be bought at any price. First priority will be to look after yourself, start investing and create independent options for the future. It is better to have money to worry about instead of just worries and no money.