6 Steps for Troubled times

While it’s natural to be nervous when financial markets are
uncertain, it’s important to stick to some basic investment
rules to help you keep current market fluctuations in perspective.

1: Get advice from a qualified source
A financial adviser can help you decide what you want to achieve with your money and how to meet your goals, while taking into account your needs, objectives and your attitude to risk. If you don’t have a financial adviser make an appointment time today call 1300 882-456

2: Take comfort from history — the long-term trend is up
Over the last twenty years or so, there have been at least ten major events that have impacted the Australian share market, including the Wall Street Crash in 1987. While each of these events resulted in a period of uncertainty, the market has always recovered.
Importantly, despite short-term market uncertainty in the past, over the long-term the general trend of share markets is upward. Australian shares, for example, continue to perform very well, up 171%1 in the last 10 years.

3: Stick to your original investment plan
Understand what you’re trying to achieve and how long you’re prepared to invest, rather than focusing on what’s happening in the market. Keep in mind that the longer your investment timeframe, the more likely you’ll experience some form of short-term market volatility. Also, understand how much risk you’re comfortable with and make sure it’s reflected in your investment plan. Cut back on your spending in troubled time and invest.

4: Don’t react to short-term market movements
Investment markets move in cycles, so it’s difficult to forecast when they’ll rise or fall. Moving your money in and out of the market during a downturn means you could potentially miss out on any positive bounce gained in a strong market recovery. Investment strategies need to be built with layers of options and “just incase measures”.

5: Diversify your investments to help spread risk
Diversification — or spreading your investment portfolio over a range of asset classes such as shares, property, fixed interest and cash — can help you spread your exposure to risk. So, if one investment or asset class loses ground, it’s likely that your other investments may offset the loss. You can diversify your investment across different asset classes, regions and investment managers or styles. Be ready to jump on investment opportunities as they arrive so be ready the right time does come.

6: Stay informed
It pays to stay informed about your investments and what’s happening in the market. For the latest on what’s driving the market and tips for investing during uncertain times, visit www.4financialadvice.com.au . For a free financial health check call 1300 882-456

Take the first step 1300 882-456

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