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Setting Investment Goals for Your Financial Future

Developing a clear picture of where you want to be financially at different stages of life helps you stay focused on your future. Once you have financial goals and a budget in place, investing can help you get there. If you are just starting out or have dealt with financial setbacks, start by focusing on short-term investment goals, which will build a strong foundation onto which you can continue to build long-term investment goals.

Questions to Consider

Ask yourself these two questions before building an investment plan. Bring your family members and financial advisor into the discussion to really focus on your motivations and long-term goals.

  1. How Risk Tolerant Are You?

    How comfortable are you going to be with fluctuations in your portfolio’s market value? No matter your risk tolerance in investing, there are options that can help you succeed. Take time to truly explore all the options you have.

  2. Will You Leave a Financial Legacy?

    Decide who is ultimately going to spend your money. Are you investing for a comfortable retirement for yourself? Or will you leave money behind for others? Consider drafting an estate plan strategy if you plan to leave assets in a trust.

How to Start Investing

Once you've determined how your timeline affects your financial goals, think about how investing might help you achieve your goals. Consider these three criteria when determining how to invest your money:

  1. Growth

    Capital appreciation measures the increased value of an investment. If you buy a stock that initially costs $10 a share — your capital — and sell the stock for $12 a share, that extra $2 represents the appreciation.

  2. Income

    Some investments periodically make interest or dividend payments, which are considered investment income. Reinvesting that income rather than spending it is an investing strategy to consider.  

  3. Stability

    Some investments focus less on increasing the value of that investment and more on protecting the principal. If you invest later in life, stability might be your primary investment goal.

Just as with your general financial goals, your investment goals should be measurable, reasonable and attainable. For example, something as simple as saving $100 every paycheck in a retirement account is a good goal. Keeping your goals reasonable and rational helps ensure your financial plans are attainable. 

Get Professional Help

To help ensure your investments can assist you to meet your financial goals, contact a Farm Bureau financial advisor to get started.