Financial Planning

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My Financial Plan

An important objective of the financial planning process is to ensure your financial growth and security over the long term.

To help achieve this, you should:

Identify your personal goals
assess your current financial position, and
determine your attitude to investment risk.

Once these have been determined, an appropriate investment strategy can be developed as a key component of your financial plan.

Asset Allocation Strategy?

After the identification of your investor profile, the asset allocation process is the single most important factor in determining whether you achieve your investment objectives.

Put simply, asset allocation is the distribution of your investment dollars among different asset classes such as international shares, property, Australian fixed interest.

The proportion of funds invested in each asset class for any investor will depend on several factors including your:

desired returns;
preferred investment time frame;
long term income earning ability;
tolerance to risk or fluctuation in returns;
need for cash flow from your investment portfolio;
general market conditions.

Diversifying Your Investments

Diversification means spreading your funds across various investment markets and/or fund managers to manage investment risk – that is, not ‘putting all your eggs in the one basket’. It works on the principle that different investment markets (such as shares, property, fixed interest and cash) perform well at different times.

In fact, over the 10 year period between 1993 and 2003, most generally accepted investment classes (or sectors) have been a top performer in at least one year. Therefore, your portfolio should be constructed using an appropriate mix of funds with exposure to investments across all or most sectors.

Ongoing Review of Your Investments

After you accept the recommended investment strategy presented by Investorplan, they will arrange the placement of investments as suggested in your investment strategy or financial plan.

To ensure the initial strategy continues to meet your objectives in keeping with your changing personal circumstances, you should meet with your financial planner at least once a year to review it.

My Personalised Situation

Financial success and security is all about establishing your goals (a financial plan) and developing an investment strategy that will help you achieve them.

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