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How To Find the Right Investment


Almost everyone has an opinion on where you should invest your wealth. You see it on TV, Facebook, Youtube, and from sales people all over the country. My mission for over a decade has been to find the truth about all investments, understand the pros and cons, and make a decision for myself on how to allocate savings.



Person looking at stocks on laptop holding a blue pen



What I've found is there is no "best" investment for everyone. If there were, everyone would do it and have no need for planning or a financial team. Finding the right investment comes down to many factors. I compare it to driving. Your gas or fuel for the car is your cash (or electric charge for the EV car owners out there!). Your investment is the vehicle you choose to get you to your destination. If you're picking up the kids from soccer practice, you probably don't want to roll up in the two seater sports car. If you're heading to Home Depot to grab lumber and drywall, I don't think the bmw sedan is the vehicle of choice.




blue pick up truck on road in the mountains



This same thought process is required when choosing your "investment vehicles". They all have different characteristics, and have different uses for investors. Not one vehicle can do everything you need it to. This is where the planning process begins...



1. What problem are you trying to solve? Before searching for investments, you need to have an understanding of the actual characteristics you want to see from a plan.


- Do you want more monthly income?

- Do you want to grow your wealth long term?

- Do you want something conservative without much risk?

- Do you want something that has tax benefits?


These are just a few of the questions you must ask yourself before investing.



2. When do you need to access the money again? This is whats known as "liquidity", how easily an investment can be turned into cash. It's important to have a good understanding of when or if you'll need access to those funds again anytime soon. One of the worst decisions is making a long term investment, and finding out you need the money in a few months. This can create massive losses in a portfolio regardless of which asset class you choose.



3. What do you know? Even if you are outsourcing your investments to a wealth management team, you should create a list of things you have experience in. The only way to get an edge in investing is to have an expertise or experience level in a certain asset class. If you have worked you're entire career in the technology space, you probably want to allocate a nice chunk of your savings into tech companies. If you have been in all trades of construction throughout your career, investing in different real estate assets would probably be a good idea.


The concept can be used for any career or education level. If you feel very comfortable and have an edge in a certain investment, spend the majority of your time and investment dollars on that. Then diversify the rest to reap the other rewards and have the specialists play their role.



4. Whats the costs? Keeping your costs low is crucial to long term success with investing. Whether its commissions, advisory fees, paying a fund manager, splitting profits, etc. Whatever structure you choose, make sure you understand the fees and reduce them as much as possible. This can erode returns overtime for your portfolio. It's typical in the wealth management world to charge 1-1.5% on average annually to manage investments. Different fund managers will charge even more plus a % of profits. We try to be at the lowest end of this range to reduce client costs as much as possible.




man in blue suit typing on calculator next to a pile of cash and notebooks



5. READ! If you want to be active in managing investments overtime, you must always be learning. Warren Buffett has been known to read for 5-6 hours a day. Compound that by 80 years and you wonder why he's the best of all time! Investing is a game of education and temperament. The world is always changing, and the only way to keep up is to educate yourself. The more you learn about business and investments, the easier it becomes to find your sweet spot for deploying your savings.



***Investing requires risk and loss of capital, this is not a solicitation of securities and purely for educational purposes."



"An investment in knowledge pays the best interest"


Need to speak with a fiduciary advisor about your retirement or investments? Book an appointment here



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