WHAT ARE THE STRATEGIES FOR INVESTMENT SUCCESS?

While there are no certainties to help make you a more successful investor, you can structure your investment strategies and plan to meet your goals and accommodate the changes in your life. After all, investing success doesn’t happen overnight.

Outline your goals.

Determine your investment goals, assess whether you’re investing for college, retirement, a home or a combination. By identifying your motivators and knowing your time horizon, you can establish an investment strategy to support your goals. As your financial needs change, you’ll need to balance and rebalance how you have allocated your investments to keep pace with your investment targets.

Know your time horizon.

Review how much time you have until you’ll need the money you have invested. Your retirement generally will be invested for long-term growth and can therefore weather short-term fluctuations in the market. However, if you’re saving to purchase a home, you may only have a few years before you need the funds. For a down payment on a home you probably will need more liquid investments.

Article: Focus on Time in the Market, Not Market Timing

Monitor performance.

Spend some time reviewing your overall portfolio performance. Don’t focus on one investment that isn’t where you want it to be. Keep your eye on the big picture.  Work with a Financial Advisor to keep your portfolio strategies in tune with your income and family changes. You’ll be able to easily view and track progress with our Command Asset Program, because it combines your banking and investing needs in one relationship. You can use Online Brokerage to review your status when it’s convenient for you—anytime, anywhere you have Internet access.

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Use dollar cost averaging to boost your earnings.

Dollar cost averaging is when you invest a fixed amount of money in regular intervals. The advantage of this strategy is that you can reduce your average cost per share in a security or mutual fund over time. For example, as the share prices of an investment fluctuates; you buy fewer shares when the price is high and more shares when the price is low, thus lowering your overall cost per share.  However, this approach does not guarantee a profit and doesn’t protect you from losses in a downturn in the market.

Article: Pay Yourself First (and Regularly) Through Dollar Cost Averaging

Compound your money, not your problems.

Compounding lets you earn interest on your interest. The way your money may grow through compounding is the greatest single benefit a long-term investment plan can offer. When you invest, you not only have the potential to earn money on what you've contributed; you also have the potential to earn money on your earnings. This is especially important since life expectancies are increasing and we will need greater assets to rely upon in retirement.

Put your money to work with compounding:

• Reinvest dividends.
  Instead of taking distributions in cash, have them remain in your account to purchase more shares. 
• Invest regularly.
  Make regular payments into your savings and investments. Consider setting up a SIP so that you will be sure to pay yourself.
• Invest long-term.
  The sooner you start saving and the longer you leave your money invested, the more time your money will have to compound. For instance, if you want to be a millionaire at 65, a 10% rate of return compounded annually beginning at age 25 means you need to invest $141 per month. However, by waiting to age 50 to begin saving, you need to invest $2,963 every month to reach $1 million.*

Wachovia Securities is the trade name used by two separate, registered broker-dealers and non-bank affiliates of Wachovia Corporation providing certain retail securities brokerage services: Wachovia Securities, LLC, Member NYSE/SIPC, and Wachovia Securities Financial Network, LLC, Member FINRA /SIPC.

Only deposit products are FDIC-insured.

Periodic investment plans do not assure a profit and do not protect against loss in declining markets. Since such a plan involves continuous investment in securities, investors should consider their financial ability to continue purchases through periods of low price levels.

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Related Links

•College Savings Worksheet
•Retirement Goal Worksheet

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