Investments Continued…

Investment Portfolio/Action Plan

If you haven't started investing yet, you should probably consider doing so. If you already have an existing investment portfolio, don't just take it for granted – you need to manage it on an ongoing basis. You should look at your investments at least once a year. Do you need to rebalance your portfolio? Are you happy with the current weighting of your equities versus fixed income vehicles? Are your mutual funds providing the returns you are looking for? Don't allow your portfolio to go on autopilot. Take an active interest in your investments and be sure you are happy with where your money is invested and that it is working hard for you.

Finding money to invest

Even if you don't think you have any money to invest, there are a number of ways that you can potentially increase your investment dollars.

If you already have a portfolio, take advantage of dividend reinvestment plans on stocks that you currently own. You will be able to buy stocks without paying commissions on the purchases. In some plans you can invest incremental money and buy even more stocks – again without paying commissions.

Pay down your consumer debt. Consider consolidating your outstanding debts into a single loan and utilize a lower interest option such as a personal line of credit or a low interest credit card. This way you will only need to make one payment per month. The money you save on interest payments can become the money you use to invest.

Don't incur new debt. Don't let yourself figure that just because you have your payments under control that you can now take on more debt.

Try living below your means, if you were fortunate enough to get a raise this year don't automatically increase your spending, try saving the increment. You lived on your salary last year and you can probably still do it this year.

An effective way of ensuring that you don't slide into spending your increment is to have the amount of your increment taken off your pay or automatically invested through a payroll savings plan. (Pay Yourself First)

Professional advice

Investing and saving intelligently is the surest way to achieve financial independence. If you do not feel that you can make the right investment decisions, find an advisor. Get professional advice from a qualified professional who you trust and feel comfortable with.

Everyone needs to think about where they are now financially, and where they want to be in the future. Financial independence requires perseverance determination, but remember, consistent saving over time will add significantly to your personal bottom line.

By Murray Anderson