Staying the Course

Once you have defined your goals, you can develop the investment strategy best suited for you to achieve them. Understanding the fundamentals of investing for different ages or life stages, as well as the types of vehicles to invest in, will enable you to come up with a workable investment plan. While your investment plan will likely be different than the next guy's, investment plans as a whole require that you stick with them in order for them to work.

Sticking with an investment plan may sound easier than it really is. It is pretty simple to stick with your investing strategy when your financial and emotional life is happy and stable. However, it's the challenging times that you need to think about. An investment plan is successful only if you are able to stick with it through good times and bad. We understand that in life, stuff happens, and adjustments are not terminal when you're pretty certain that you've developed the right financial plan for you.

However, if you find yourself swaying from your investment plan more often than not, chances are good that you need to reevaluate the investment course you're on. Most investment plans don't have a good rate of success if you can't stick to them.

Altering your investment strategy. If you think you need to alter your investment strategy, try this exercise. Break down your strategy into the following very basic components: the amount you invest, when you invest, and what you invest in. You may find that you can adjust a part of your investment plan that will enable you to better stick with the plan as a whole. For example, you may find that you've been overly optimistic about the amount you are realistically able to invest. Or perhaps you can invest that amount, but not on the timetable you originally came up with. Maybe your problem is with the vehicles you're investing in. For example, if the stock market is on a downturn and you find that you can't stick with your investments in stocks during rough economic periods, then stocks may not be the right place for your investing dollars, because of your personal tolerance for risk.

Tip Altering your investment plan should never be done on a whim. Changing your investment strategy will in all likelihood necessitate that you change, at the very least, the timeline of your goals. In some cases, depending on the age and stage of your life, completely changing your investment plan may not be an option if you are still intent on achieving your goals. However, you should always be able to make some sort of adjustment to your investing plan so that you are able to continue with it on a regular basis.

If you are not able to stay on course when it comes to your investment plan, you may want to reconsider the goals you've set. You may find that these goals no longer inspire you, or perhaps you'll find you weren't that committed to them in the first place. Remember, your money has the most earning power when it is invested properly. And your money is only invested properly when it enables you to reach the goals you have decided will fulfill your life.

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