SAVINGS & INVESTMENTS
Investment options can be very confusing and finding the right mix of a good return at an acceptable level of risk is challenging. At LMFS we identify the investment choices that best meets your requirements, based on your risk profile.
Most of us need to save in order to fund for future life events – holidays, marriage, home purchase, education, retirement. It is best to develop a structured savings regime by way of regular monthly payments into an appropriate savings product. Perhaps all that is needed is to save in a regular bank savings account, particularly if you are likely to need the funds in the short to medium term (less than 5 years). However, if you are saving for the medium to long-term (over 5 years) then you need to think clever and opt for a savings vehicle that will help your money to grow. Call LMFS for a confidential assessment of the best options for you.
If you have a lump sum to invest it is important to assess what your requirements are. You need to determine what your priorities are and make your decisions based on several important elements of any investment.
Considerations before you Invest
What is your attitude to risk? The potential for higher returns invariably carries a higher level of risk. Apart from the security of the underlying asset, there are other risks, for example, your investment may be affected by fluctuations in exchange rates.
What return are you seeking and is it a realistic target? If it looks too good to be true then it probably is. Many products are cleverly packaged to give the appearance of offering specific and attractive returns but most often they are indicative numbers and are not guaranteed. Read the small print.
It is important where possible to spread your investment across a selection of financial products and asset classes. As the saying goes, do not place all of your eggs in one basket, just in case you fall!
How important is access to your funds? Can you afford to lock your funds in for 3, 4 or 5 years or even longer? Be sure to keep some funds in an accessible medium for emergencies.
Even attractive investments can sometimes be difficult to encash. Property is a key example and many property funds have strict exit conditions, which can make encashment difficult.
Past performance is no guarantee of what may happen in the future. However, it is useful to look at the performance of any financial institution or financial product in the past. Always look at performance over an extended time frame and companies that consistently perform at the required level should be considered positively.
Establish what costs will be associated with your investment. Some funds offer attractive returns but are subject to exorbitant annual management charges and other fees.
Establish at the outset how any gains will be treated from a tax perspective and learn of any tax free limits that may exist.