Diverse Investments Lead to Positive Returns



Financial planning is a discipline best served by long-term vision, rather than short term gains. Of course positive returns are good news at every stage of the game, but lasting progress is the best measure of investment success. And to make the most of savings and investments, it’s important to diversify, creating multiple opportunities for your money to grow.

In addition to online resources offering finance information, personal financial counselors are available to help identify investment strategies best suited to your financial needs and goals. With their assistance and commitment to the long-haul, you’ll profit from steady gains and have money available when you need it. And since financial markets continually evolve, your plan may require adjustments over time. As you set your course for financial success, use proven approaches to maximise your returns.

Beating Investment Averages

Naturally, investors hold hopes for major financial windfalls. As a result, some aggressive investors take an extremely active approach to financial management, striving to beat market averages. But while dedicated analysts may find success using this method, casual investors often prefer a more passive approach.

Spreading holdings across various investments helps hedge against financial distress, softening negative impacts brought-on by downturns in a particular area of your portfolio. The strategy is particularly effective for passive investors, who do not wish to track daily performance of their individual holdings. And while one-time windfalls are not as commonplace for diversified investors, long-term payouts furnish consistent returns.
Ultimately, your best bet is to rely on pensions, savings and securities to accumulate resources. And depending upon your age and financial goals, each of these investment vehicles should be weighted properly, within your portfolio.

Savers Make Progress in Zero Inflation Market

Conditions are changing for savers, who have experienced challenging times in recent years. With dismal interest rates on savings accounts, investors have not even been able to keep pace with inflation. According to recently released data, however, the Consumer Price Index has fallen to 0pc. The drop from .3pc is attributed to falling oil prices and continued price relief at the supermarket. As a result, savers are finally finding themselves in a position to earn reasonable returns on conservative investments.

Consider the following example provided by the Express: Investors who set aside £10,000 five years ago and earned average interest, taxed at 20 per cent, would realise approximately £8,792 spending power on the same sum today. That represents a 12% decline in terms of what the saved money could buy.

Without inflation, however investors with savings accounts paying 1.5 per cent and bonds yielding 3 per cent will benefit from the increased spending power of their investments. Better returns make savings a more attractive part of a comprehensive money management strategy.

Is Buy-to-Let Right for You?

Buy-to-let properties generate investment income, but managing real estate is not for everyone. Currently, demand is high for rentals, which provide reasonable alternatives to buying high-priced homes. As a result, landlords are not experiencing major voids in occupancy. And since mortgage rates are also at all-time lows, buy to let financing is about as attractive as it ever gets. As investors seek alternatives to low-yield savings and other investments, buy to let is popping up as a viable consideration.

Before leaning on rental properties as a source of income, it is important to evaluate your tolerance for being a landlord. Unlike other places you might put your money, owning property is not a passive investment. On the contrary, landlords spend considerable time maintaining, letting, and administering to their rental businesses. If your schedule is inflexible or you are not of a mind to put in the time, buy-to-let investments might not be well-suited for your lifestyle. Before investing, consult with existing landlords, for a first-hand take on the benefits and drawbacks of owning property.

Successful personal money management includes a diversified investment portfolio. By spreading your holdings across a wide range of investments, you are less susceptible to financial catastrophe. For financial security, use a blend of savings, securities, real estate and other alternatives to build wealth and protect your assets.

Paul graduated in 2001 with a degree in Finance. Since then he has gone on to work for several of the UK's most well-known financial institutions.

An avid blogger and a huge football fan, Paul is here to guide you through the ins and outs of personal finance and perhaps save you some money in the process!

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