Investment Planning

Investment planning is the process of determining how to invest your current assets and future savings towards based your short, intermediate and long-term financial goals, your current financial situation, your risk tolerance and your tax situation. A good investment plan identifies those financial goals and assigns a dollar figure and time frame to each goal. After defining the parameters, the proper investment instruments can be selected to support those goals.

• Short-term investments (0-2 years) are usually best supported by high-yield deposit accounts, money market accounts, short-term bonds and short-term CDs.
• Intermediate-term investments (3-5 years) typically rely on intermediate term bonds, intermediate-term CDs. Stable, high-dividend paying stocks might be appropriate for goals that are 4-5 years in the future.
• Long-term investments (5-7 years +) should be more heavily oriented towards the stock market, which provides superior returns to bonds over extended peroids of time, but has significantly more short-term volatility.

There are a huge number of equity products avaiable for purchase today, including individual stocks, mutual funds (both open-ended funds and closed-end funds), exchange-traded funds (ETFs), separately managed accounts (SMAs), unit investment trusts (UITs), hedge funds and private equity arrangements.

Two key rules to always keep in mind when selecting investments are:

• If it sounds too good to be true, it probably is, and
• Never invest in anything you don't understand (regardless of how persuasive the salesperson is)

Please visit our Savings Calculators to find out how much you need to save to reach certain financial goals.