Thus, we should follow the SMART principle, which states that our goals should be Specific (for example, save $50,000 to buy a car), Measurable (for example, plan to buy a car costing a sum we can afford), Realistic (for example, plan to buy a car costing a sum we can afford), Timely (for example, plan to buy a car costing a sum we can afford), and Timely (for example, plan to buy a car costing a (say, achievable within a reasonable time period). Learn more by visiting Charles R. Green & Associates, Inc.-Investment Planning.
We can plan how to meet our SMART financial goals if we know what they are. If we don’t know how to make a financial plan that works for us, we can hire a financial advisor to help us. One thing to keep in mind is that we should seek the advice of a financial planner who is both competent (e.g., has the CFPBSI’s Certified Financial Planner credential, which is recognised worldwide) and experienced (and perhaps licenced to practise as a financial planner by the appropriate authorities to ensure accountability and ethical behaviour).
Before making any investment decisions, we must first consider ourselves in terms of our personal financial risk profile. In our everyday lives, we all take chances, whether it’s crossing a busy street, flying somewhere, or even getting married, given the rising number of separations and divorces. It’s important to remember that different individuals have different risk tolerance levels for a variety of reasons.
Assuming a danger for which we are not prepared or capable may have negative effects and be harmful to our wellbeing. Similarly, the level of financial risk we are willing to accept or tolerate should be carefully assessed, and this evaluation will typically be based on a set of parameters specific to each person. Furthermore, an individual’s risk profile can change as his or her personal circumstances change, and it is widely agreed that a younger person can take on more financial risk than anyone approaching retirement because the former has more time to accumulate or recoup losses due to poor investment decisions.