Short-term vs long-term investing

The investment strategy that is right for you will depend on your personal circumstances, your stage of life and your tolerance for risk.

Generally speaking, long-term investments are the best option for most individual investors, but it’s best to find a wealth management advisory service that truly tailors an investment strategy to your personal needs.

A long-term investment typically means that you hold the investment for five years or longer, while short-term investments are for investors who will need access to their money in under five years.

At North Advisory, we take the time to understand your situation and life goals to deliver a bespoke investment roadmap to suit how you live your life today and your plans for the future.

Short-term investments

At North Advisory, we believe maintaining a long-term view is the key to successful investment and the foundation of wealth accumulation that will secure your future and fund your retirement.

However, some people like to discuss short-term investment options with their financial advisor or accountant to explore their options for generating an income source over a shorter time period.

Short-term investments might include investments such as:

Bonds
Cash
Annuities

At North Advisory, we have the skills and experience to guide you through your choices and make investment recommendations based on your unique set of criteria.

Long-term investments

Long-term investments usually take the shape of assets like shares and real estate, providing significant growth opportunities for your portfolio.

But investors entering into long-term investments must do so with the knowledge the money they invest may not be available or ‘liquid’ for many years.

Two well-telegraphed benefits of long-term investment are:

1. Cushioning from the impacts of inflation

Inflation is a general increase in the price of goods and services that reduces the purchasing power of your money.

Is it really possible to beat inflation?

Some successful long-term investors would say yes!

Inflation impacts all sectors of the economy, but long-term investments may offer some protection against inflation if you are able to hold the asset during difficult inflationary periods to essentially ride out the bad times.

2. Security for retirement

Your time spent in retirement may well account for one third of your life, so it’s never too early to start planning for it.

The best-case scenario for building wealth is to do so over decades, giving long-term investments time to grow and weather the inevitable ups and downs of the market.

At North Advisory, we provide direct ownership of your assets when we build your portfolio, so you are never tied to us or a financial platform – removing unnecessary risk.

Ask us more about long-term investing to build your wealth portfolio today.

How to tackle long-term investing

If you’ve decided you’re in it for the long haul and you’re ready to take control of your financial future and build wealth, it’s important to get your finances in order first.

Consider what you earn and what your expenses are.

What do you have left over to work with as an investor?

Next, take stock of your assets and debts and ask your accountant about setting up a debt management plan, if necessary.

Don’t forget to create a buffer too, affectionately known as an ’emergency fund’ – ask your financial advisor to calculate how much you need to put into this fund to protect yourself and your family.

Taking stock of where you’re at and planning where you want to be is a vital first step in your investing planning.

Remember, long-term investments are designed to be just that, long term, and you don’t want to undercut your financial goals by withdrawing funds from them too soon, nor incurring unwelcome tax implications.

At North Advisory, our wealth accumulation specialists specialise in flexible investment strategies that really set you up for success.

Know your time goal and your risk tolerance

We all have different investing goals, but some will be time sensitive, for example:

providing for children’s education
building a home
reducing your work hours in readiness for retirement
retirement.

At North Advisory, we create your ‘personal dashboard’ to help you regularly review your investments’ performance to help us in helping you prepare for your future.

We believe it is never too early to start investing, but successful investing is dependent on a strategy tailored to your individual circumstances and personal risk tolerance profile.

Our advisors will help you to figure out your risk tolerance in our initial wealth management meetings – a critical step in customising your investment choices to ensure they are aligned with your ultimate financial goals and personal objectives.

The right investment strategy for you

At North Advisory, we develop the right investment strategy for you – a strategy that grows and changes as you do.

Periodic adjustments are made to the strategy as life changes occur, such as job changes, family structure changes and ageing.

The North Advisory wealth management team conducts regular, in-depth reviews of each client’s portfolios – assessing underlying assets, the costs of maintaining investments and the identification of any opportunities to change path, if suitable.

There is no ‘cookie cutter’ approach to our ethos, and we encourage our clients to take an active role in their investment management.

To learn more about the skills and experience we have to guide you through your investment choices, contact us today.

Short-term vs long-term investing

Short-term investments

Long-term investments

How to tackle long-term investing

Know your time goal and your risk tolerance

The right investment strategy for you

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