This time of year is a time of reflection and re-commitment. A few of us will even go to the effort of making some new year's resolutions. Those that write such goals down will likely be more successful in achieving their ambitions. Those that don't may well be making the same goals in 2026.
A common question from loved ones at this time of year is "what do you want for Christmas?" Or throughout the year you me be asked "what would you like for your birthday/mothers' day/fathers' day, etc?" Kids seem to find it easy to come up with their lists for Santa, but many adults simply do not know what they want.
When it comes to your investments, do you know what you want?
A big part of planning for your financial future is deciding how to invest your wealth. Often, an investor will start the investment process with only a return objective in mind (e.g. "I want to earn 10% per year" or "I want to earn more than what I could get from my bank"). Even though investment goals based upon a desired return are easy to position and monitor, more often than not, such goals do not incorporate the true goals of the investor. In order to make good decisions on how much risk your portfolio should take on, or what asset classes to allocate funds to, it is important to understand and articulate what you exactly want your investments to do. Some good questions to think about might be:
- What income do I want to draw from my assets in retirement? How flexible are my income requirements?
- How much money do I wish to leave to children? Or will I simply leave whatever is leftover?
- Do I have some aspirational targets for my level of wealth?
Some of these goals will be non-negotiable, whereas others will be contingent upon the growth of your portfolio or future income levels. Goals will need to be prioritised based on importance and urgency, and some goals may need to be moved into the "wishful thinking" category. Once such goals are uncovered in detail and clearly articulated, the process of managing investments can become a much more personal and real experience.
A big part of planning for the future is knowing what you want. A big part of achieving what you want is in articulating and writing out your goals. Without a vision for the future, planning is simply redundant, and without a good plan, outcomes can fall to chance rather than design. With something as important as your future financial well-being, spending the time to figure out what you really want from your investments would be a worthwhile activity.
LBW Wealth Management is an Authorised Representative of Wealthsure Financial Services Pty Limited AFSL 326450
This article has been prepared by LBW's investment committee based on its understanding of current regulatory requirements and laws. It is not considered advice and provides general information pertaining to our ideology surrounding future asset allocation strategies. It does not take into account each client's individual objectives, financial situation or needs. If you would like to know how LBW's understanding of the current environment impacts on your portfolio please contact a Financial Adviser and to discuss your options or before making an investment decisions.
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