It’s no secret that the best way to build wealth is through a solid financial and investment plan. However, it is easier said than done. Drawing a financial plan is no mean task; implementing it is even more difficult. It is even worse when you spend sleepless nights drawing up a financial plan only for it to fall to pieces during implementation. Worst still is watching your plan go south; it can crush your spirit. That’s why you need the best investment plan that works to ensure you become financially sound. GuardianWealth wealth management app helps you create best investment plans and stick to them.
So what is financial planning?
A financial plan details the strategies you put in place to ensure that you become financially free both now and in the future. Though a financial plan includes an investment plan, they are not the same. The financial plan is the overall strategy to become financially well while the personal investment plan is just a component of the financial strategy.
A financial plan usually goes through four phases to help you achieve your financial goals.
Evaluating your entire financial status helps you to know how strong or weak your finances are. This phase involves calculating your income to know exactly how much you make monthly. Then comes the listing of all your expenditures to determine how much you spend. Evaluating your finances goes a long way to determine the strategies that would suit your financial goals.
Writing a budget helps you to streamline your finances and cut off excesses so that you can achieve financial freedom. Cutting off excesses allows you to save enough money to subscribe to the best saving plan of your choice. Drawing a budget can be tricky and difficult, but a budget planner makes it easier.
After cutting off the excesses and streamlining your finances, the next phase is to save. Saving doesn’t only improve your finances but improves your mental health as well. The knowledge that you have saved enough to help you choose the best investment plan help your achieve financial wellness and holistic wellness. Saving enough money can come in handy during emergencies as well.
However, saving alone cannot make you financially free. Money loses value over time, so, though saving is good, it can’t make you rich without investing. Your money needs to make more money for you. That is why you need a great investment plan.
It is simply tailoring your financial resources to match your financial goals. An investment plan takes a look at your entire income and helps you to choose an investment vehicle that’ll help you achieve financial freedom. The journey to financial freedom is not the same for everyone. Several factors including individual lifestyle and income can affect the journey. For example, the road to being financially free may be shorter for a six-figure earner than a four-figure earner. However, the length of the journey is not as important as the destination which, in this case, is financial freedom. That is why you need a personal investment plan that suits your income. Getting a tailor-made investment plan will ensure that you’ll become financially free regardless of how long it takes and that is the hallmark of the GuardianWealth investment scheme.
Though different websites list different types of investment plans, this article would sum them all up into two general types – defensive investments and growth investments.
Investing in short-term instruments that generate returns over a few days is referred to as a defensive investment plan. Examples of defensive investments include Certificate of Deposits, Money Market Accounts, Cash Management Accounts, Treasurys, etc. Here, all you do is deposit money into any of these instruments and go to sleep. Within 90 days or less, the plan will yield returns on your initial capital. Defensive investment is the investment plan with the lowest interest rate but is considered the safest. Most investors tend to use the defensive investment plan as a means to safeguard their capital while looking for a more profitable plan.
If you want to grow your money, then the growth investment plan is for you. Unlike a defensive investment plan, growth investing increases your returns at an above-average rate. It is termed offensive investing because its main focus is to ensure your returns grow at a faster rate. Examples of growth investment plans include Small-Cap Stocks, Technology and Health Stocks, and Speculative Investments. It follows a company or a stock that has a great potential to grow and make the investor some good money.
Choosing a plan goes beyond just selecting a few investment vehicles and dumping your money into them in the hope that they will generate some returns. You need to consider your income, expenditure, goals, and the risks you are willing and able to take before you choose a Wealth Management Plan. Here is a comprehensive guide to help you decide which plan will suit your needs.
In the world of investing, you are largely limited by your total income. The amount of money you earn will influence the kind of investment plan to choose. So, tabulate all your income and expenditure so that you can get a clear picture of how much you earn monthly. You can then draw a detailed budget to determine how much is left after you have made all expenses. If you need any help in drawing an exhaustive budget that reflects the true picture of your current financial situation, then trust the GuardianWealth budget planner. This will help you to choose the right plan according to your current situation.
After you’ve realized your total monthly earnings, the next step in choosing an investment plan is to define your goals. A lot of the time, people join investment schemes for the sake of it. They have no predefined goals as to what they expect to derive from that particular plan. Thus, they jump onto an investment bandwagon that comes to town only for them to regret it later down the line. To choose the best investment plan, you need to know the reason you are investing. That will help you choose the appropriate investment strategy.
After determining your investment goals, you need to perform a very critical self-examination to determine how much you are willing to risk and lose. Wealth Investment Plan, if work out well can be a source of happiness, however, they can also be a source of frustration when they go wrong. So, assess your risk tolerance level so that you don’t take unnecessary risks that may have a negative impact on your life when things don’t go as planned. The rule of thumb for investment plans is that the younger you are the more risks you can take because you (and the market) will have time to recover. The older you are the fewer risks you should take as time may not be your companion. Note that the plans that have a high-risk potential also have higher returns while the ones with a low-risk potential have lower returns. So, assess your risk tolerance before you go in for any financial investment planning to forestall any future frustrations.
Now that you have assessed your current financial state and have defined your financial goals, the next step is to choose the right plan. Choosing your plan should sync perfectly with your goals. So, if your goal is to protect your capital, the right plan to choose will be a defensive investment plan. However, if you want to improve your finances, the ideal plan will be a growth investment plan.
Every investment vehicle comes with its associated risks. Some are riskier but have higher returns, while some are safer, but the returns are low. Therefore, you need to speak with a financial advisor to know which plan will match your financial goals. You can also explore digital investment advisor that uses a time-tested approach to investing that will both to safeguard and to grow your money.
Though financial plans can generate passive income while you sleep, it is advisable to keep an eye on your investments. This would help you to know the areas of your plan that require a little bit of tweaking to optimize it. Always read the latest news surrounding your investments to know when to increase your investments or withdraw. Review your entire plan by creating assessment steps to help you know whether you are on the right track, or have veered off. Make sure that you don’t leave anything to chance after investing, but play an active role by monitoring it to ensure it helps you achieve your financial goals.
GuardianWealth is an all-in-personal finance app that help you save more and achieve your financial goals. Its app has a comprehensive set of financial planning tools that empowers you to achieve financial freedom and a digital financial planner that personalizes your experience. The app is easy to use and offers you a reliable financial planner at your fingertips to help you. Investment plans are customized to suit your financial goals, timelines, and orientation towards risks. GuardianWealth’s personalized investment plan allows you to relax and watch your financial goals come to life.