Investment Goals

Next

Identifying your goals and what they mean.

Maybe you want to buy a home or a car … take a dream vacation … pay college tuition for your children or yourself … start a business … build a nest egg for your retirement … or turn existing savings into a monthly income.

Chances are you have many different goals — and you may need several different investment strategies to meet those goals.

Start by listing each goal, how much money you’ll need, and when you’ll need it. Lump together any goals that have similar end dates – when you’ll need the money. As an example, you may end up with a list that looks like this:

  • Emergency fund — three months of income — should have at all times
  • Cruise for family — $2,100 — 6 months from now
  • New car and new refrigerator— $27,500 — 18 to 24 months from now
  • College tuition — $174,000 — 12 years from now
  • Retirement fund — unknown — 10 to 20 years from now   More

Once you’ve made your list, you can then start characterizing the general directions to take: preservation of principal (protecting the money from any risk of loss); conservative growth; aggressive growth; steady income, and so forth.See Time Horizon, Risk and Return and Asset Allocation for more details.