Step 1: Defining Your Goals
The first step in creating your investment plan is to determine your personal goals.
Here are some common reasons that people invest:
- You want to generate additional income
- You are saving for education
- You are saving for a new home
- You want to reduce income taxes
- You’re planning for retirement
- You want to be prepared for emergencies
- You’re interested in supporting a socially responsible business
There are other things to think about too. How much can you afford to invest? How open are you to taking financial risks? How do you balance the need for long-term savings with your more immediate financial needs?
Setting goals will not only motivate you to stick to your plan but will also act as a guideline to help you achieve financial fitness.
Step 2: Build Your Plan