You have heard the narrative severally on why you should invest, what you should invest in, and all other relevant information. But why are you investing? What is this need you want to fulfil?
Having a purpose is essential as it gives the direction of your actions, but not everyone is aware of their purpose just yet. In that case, it’s okay to piggyback on someone else’s as you figure out what it is you would want to achieve. Financial Independence is never the finish line; it is only a means to an end. In finding this end, you can work backwards to enable you to reach there by your set timeline.
In working towards Financial Independence, and ultimately your purpose, there are some considerations to be made when identifying the investments that will get you there;
1. Is it within the time horizon?
Be it a 5, 10, or 15-year plan; the investment must be able to meet that goal in the set time. Will it be able to achieve what you want it to within that period? Will it work with another investment to reach where you want it?
Identifying whether your goals are short or long-term is an excellent place to start.
2. Is it passive?
Will you have to babysit this investment, or can it work without your being there? The best part of an investment is watching it take off without extra effort from you. Earning while you sleep should be one of your criteria for investment if it isn’t already.
3. Is it reputable?
Have you done your due diligence to confirm the investment is best suited for you? With the sheer number of investment options, you need to be firm in your needs and make the best decision; due diligence will enable that.
4. Will it get you to your goal?
Financial Independence is a means to an end. It is meant to finance your needs, wants, desires, and ultimately, your purpose. Will the investments you choose be able to finance this?
5. Do you have the investment in mind?
There are many investments out there, so which one is it or you? What will enable you to reach your goal? If you don’t know already, then now is the time to find out.
As an investor, you require a large amount of clarity and self-discipline to know what you want and how to get there.
Are you interested in discovering what your unique investment needs are? Schedule a call with your FIRE Partner by filling in this link. Before investing, understand what your needs are and how an investment can fulfil them for you.