The financial planners share their advice for successful investment to reach your goals

We think it is important every once in a while, to close your eyes, tune out from the daily media onslaught of political, market and economic chaos, take a deep breath and think: what am I actually investing for? And how will I know if I am successful or not?

The answer can only be found in your own personal situation and will depend on whether you are following these three fundamental steps to successful investing:

1. Have you set specific goals?

Ask yourself: what am I investing for? What are my deepest, most cherished goals? Will I outlive my money, or will it outlive me? How much do I need to reach my goals? The goal is not about outperforming the market or getting in and out at the ‘right time’.  Goals don’t have to be complicated. Your ‘end’ could be as simple as not running out of money in retirement.

2. Do you have a plan?
Do you have a date-specific, pound-specific plan for building up the money required in the allotted time?

3. Portfolio – this is the funding vehicle for your plan. The portfolio you choose should be based on what mix of assets has historically delivered the return you need to help you achieve your goals.

The (very human) temptation to stay in cash

Perhaps you have been feeling a pull to stay in cash until things ‘settle down’? The market is ‘too high’, ‘it’s shot up too quickly’, ‘there’s bound to be another crash’, isn’t there?

The impulse to stay in cash is every bit as basic as the instinct to sell everything when stock prices are nose-diving and the media onslaught is relentless.

But until you take a step back, (or your high-quality financial planner saves you from yourself!), the chances are you will give in to this temptation over and over again, meaning you never have true, lasting investment success. As Warren Buffet’s mentor Benjamin Graham put it, “The investor’s chief problem – and even her worst enemy – is likely to be herself”.

The chart above shows that equity funds have barely taken in fresh investments since the March 2009 bottom, despite a 660 per cent return for the Standard & Poor’s 500. Bond funds and exchange-traded funds, meanwhile, have taken in more than $3 trillion.

In the last 13 months the S&P 500 has gone from circa 2200 to 4100 index points. It has nearly doubled. Just let that sink in…

“The best time to plant a tree was 20 years ago. The second-best time is now” – Chinese proverb.

Engaging a high-quality financial planner could help you plant your tree and ensure it is fed, nurtured and pruned as you go through your life.

Raj Shah is founder of Blue Wealth Capital and has been shortlisted for Financial Planner of the Year and Investment Adviser of the Year. Raj can be reached at:

Fiona Shah is operations director at Blue Wealth Capital. Fiona can be reached at: