• Rachael Panteney

WHAT IS GOAL BASED INVESTING?

Without a plan, you could (again, theoretically) get lucky when investing, but the odds are against it.


Without goals – and a well-thought-out plan for meeting those goals – you probably won’t end up where you want to be financially, in either the short- or long-term.

You have to make goals to meet goals..


Determining your investment goals at Willow Tree Financial Services
Determining your investment goals at Willow Tree Financial Services
“If you don’t know where you are going, you might wind up someplace else.” – Yogi Berra

There are several ways to approach investment goals. Traditionally, investors have focused on generating the highest possible returns or beating the market, while staying within their comfort zones in terms of risk.


A relatively new approach to wealth management is goal-based investing, which emphasises investing with the objective of reaching specific life goals – such as buying a house, saving for your child’s education, or building a nest egg for retirement – instead of comparing returns to a benchmark.


The theory is that setting goals makes it more likely that you’ll save for – and achieve – every goal.

  • You'll be more motivated to reach a goal since you can gauge its progress.

  • You can consider the time horizon and risk level separately for each goal, and invest accordingly.


Whichever approach you prefer, the important thing is to do something, and not just leave your financial health to chance.

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