Financially Fit & Fabulous – Wealth Builder: Long Term Planning

SETTING goals for a time which might now seem far into the future, will help you to realise those dreams in a way which would never happen if you had not planned them.

Long term goals include early retirement, first and second homes, special vacations, children’s college education, and they may even include your plan to complete a doctoral degree before you reach forty.

The saying goes: If you fail to plan, you are planning to fail. Long term planning is especially effective in relation to savings and investments, as investments grow in value over time and are like the bricks that are used to build a house. A strong beginning leads to a beautiful ending.

Your financial advisor will tell you that setting financial goals is an important step to financial security and living in more comfort as you get older.

Some long term goals could be:

• Buying an investment property and getting started in Airbnb

• Starting your own business

• Sending your children to the best schools locally or abroad

• Enjoying a comfortable retirement.

Budgeting continuously and sticking to it, alongside an annual savings and investment planning is recommended all along the way. Your long-term vision is set, but make new financial goals every year that fit into this vision and review to see how well you are doing.

Did you stick to your budgeting and investment plan? In what areas did you fail and how can this be avoided in the future? Did you miss your savings and investments targets, if so why? Failure is not a signal that you should give up trying. If you have missed a goal, it only means that you should find new strategies to succeed the next time around.

Some tools which can help you to achieve your long-term financial goals are:

Money Funds

Mutual Funds belong to a collective investment scheme where monies of numerous individual investors are pooled to create a portfolio of financial securities. The financial securities may be from any of the asset classes – cash, income or growth or a combination.  Individual investors are then able to purchase an individual mutual fund from each asset class or a combination of funds from all asset classes to build a diversified portfolio.

Pension Plans

Pension plans are offered both by companies and investment houses. These long-term savings can be tapped when you decide to leave the workplace for good.

Stock Market

You can buy shares in companies which based on their life cycle, has good growth prospects, providing improved value and dividend income.

Real Estate

In the Jamaican market, houses and lands usually appreciate, providing a storehouse of value which can provide you with income either through rental or sale. 

Insurance

Getting property, health and disability insurance are also important elements of long-term planning as they provide a cushion you can fall back on if things go wrong.

Get Expert Advice

At all times, seek good advice such as that coming from a financial advisor who will help you navigate the financial markets and connect you with solutions to help you reach your financial goals faster.

Nerisse Pottinger is a licensed Investment Advisor from Scotia Investments Jamaica Limited.