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Date Created: 12/20/15
Managing for Maximum Financial Return The objective of a savings plan is to grow your wealth for your future security. If you work hard to save some of your income on a regular basis, you want that money to work hard for you, not just keep up with inflation. This is what an investment plan is all about. The money you have invested is called an ‘Investment Portfolio’. It can be made up of cash, shares, bonds, stocks, property, mutual funds and a host of other money-earning possibilities. Anyone who has a savings plan should also have an investment plan. Even for a person with limited savings, there are many more options available than leaving their money in the bank at an interest rate that barely covers inflation. And in deflationary portfolio management software times, you can even see the purchasing power of your money decrease. The process of choosing and tracking the right investment to give the best balance between a minimum of risk and a maximum of return is called Portfolio Management. This can be done by the investor or by an expert whom the investor pays. The Investment Lolly Shop Today’s complex financial market means that it’s difficult for the layperson to understand and evaluate all the options available for investing. A portfolio manager is a person who has been trained to understand an investor’s financial needs and has a broad understanding of all the available options in order to offer the best, tailored investment plan. It is the investment portfolio manager’s job to give the client a clear picture of the risk profile of the recommended investment strategy. Just as everyone is different, so circumstances and needs are different. The portfolio manager will need to tailor-make an investment for each investor. This is a complex business that balances the amount of risk you can afford to take with the best return possible. It’s certainly true that very high-risk investment portfolios can sometimes generate astonishingly high returns: it’s also true that they can lose a great deal of money. A portfolio manager needs to be very clear about the potential risk of an investment. DIY Portfolio Management As the baby boomers age, some retiring or reducing their work, more and more people are looking carefully at making their money work hard for them. They often resent the fees they need to pay to ‘experts’, whose advice may or may not be worth the expense. They look for ways to manage their own investments. Do It Yourself portfolio management can save you thousands of dollars in costs, but it does carry risks for the novice, even if you believe you have a good understanding of investing. If you believe you have the time and capability to do this, it’s still wise to tap into the experts, who make a career of knowing the detail of investment options. A DIY investor can benefit greatly from having access to tools that help organise and advise. Financial Planning software can help provide a strategic planning framework and guide your understanding of the intricacies involved in portfolio decisions. To learn more about how Portfolio Management software can help you stay ahead in the investment game, click here. Your portfolio needs to reflect your short- and long-term financial plan. Even if you engage a financial planner to help, having your own financial planning resource centre online can help you stay up-to-date and more involved in these important decisions. https://www.trulity.com.au
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