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Four Key Questions to Ask Before Building Your Investment Portfolio

August 4, 2020 | Investment

I recently watched this incredible video on Jeff Bezos’ morning routine. For those who haven’t seen it, it’s a must watch – it opened my eyes to the many parallels that exist between building a successful company and achieving success with an investment portfolio.

If you haven’t heard of him, Bezos, owner and founder of Amazon is currently ranked the wealthiest person on earth.

Watch the video here:

I Tried Jeff Bezos’ Morning Routine For 28 Days

In the advice laid out by Bezos, he touches on the most important thing of all, something integral to building a successful investment portfolio or the world’s most successful company for that matter. As Bezos puts it, it’s crucial that you focus on factors within your control. You cannot control the ups and downs of investment markets, but you can control how to invest your money.

To significantly improve your chances of achieving your goals, you should start by developing an investment plan. Whether you do this on your own, or enlist the help of an experienced financial adviser, it’s important to answer four key questions before you set out:

  1. Why are you investing?
  2. How long are you investing for?
  3. Are your circumstances likely to change in the future?
  4. How much investment risk are you prepared to take on?

With those questions answered, the first step in building your investment plan is getting your asset allocation right. How you allocate your money to each asset class is one of the most important decisions you will make.

Second, you need to decide how to invest your money – here are a few examples of the options you have available:

  • Will you invest inside the tax effective framework of superannuation?
  • Will you invest outside of superannuation to retain more control and preserve greater access to your money?
  • Should you invest directly in the markets or access a wider range of investments through a professionally managed fund? Keep in mind that if you are investing in a managed fund, you need to decide how you would like your money to be managed.

If you get stuck on this step, an experienced financial adviser can help you decide the right investment structure and asset allocation based on your individual needs.

Remember most of all, markets move up and down over time and this can move your portfolio away from the goals of your original investment plan as well as changing your exposure to investment risk and potential returns.

It is not only investment markets that change. You will experience life changes as well, like starting a family, purchasing a new home, or starting a new job. As such, it’s always wise to regularly revisit your investment portfolio and your investment plan to ensure you remain on track to achieve your original goals and experience success as an investor.

If you would prefer to have the support of a trusted company with more than 160 years of combined investment experience, contact Coastal Advice Group. Achieve financial success and certainty knowing we are behind you – no matter your starting point or how big your goals may be. Click here to book today.


Reference: https://www.youtube.com/watch?v=9-XsjQi_OSs

DISCLAIMER: The views expressed in this publication are solely those of the author; they are not reflective or indicative of RI Advice Group’s position and are not to be attributed to RI Advice Group. They cannot be reproduced in any form without the express written consent of the author. This information (including taxation) is general in nature and does not consider your individual circumstances or needs. Do not act until you seek professional advice. Newcastle Financial Planning Group, Central Coast Financial Planning Group, Sydney Wealth Advisers, Coastal Advice Port Macquarie and Coastal Advice Ballina Byron are subsidiaries of Coastal Advice Group Pty Ltd which is a Corporate Authorised Representative of RI Advice Group Pty Ltd, ABN 23 001 774 125 AFSL 238429.

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