The investment strategy to achieve Financial freedom is when a person financially free. This means that means we are free to do whatever you like in the context of finance. It works so just a thing that was done because of passion because the basic needs are already met.
Technically, financial freedom is the State in which the passive income and investment income can cover expenses. If you want a more secure again, passive income and investment income must be equal to double the spending.
That’s why we need a proper strategy to produce the figure with a passive income and investment. Refer to the steps that should take to build an effective investment strategy.
4 an Effective Investment Strategy to Achieve Financial Freedom
1. Determine financial goals
The first step in investing is to determine financial goals. After that, design investments accordingly to achieve those goals. Is if you want to go somewhere, we have to know the first goal.
After that, determine what the appropriate vehicle to arrive at that goal. Make sure we know what you want to accomplish, specify the target for each financial goal. In this case, our goal is to gain financial freedom.
But, everyone has different figures to declare their financial freedom. So we need to know how much money is a must-have for reaching financial freedom.
2. create an investment portfolio
The investment portfolio is a combination of several investments with a particular portion. Build an investment portfolio is a crucial step in investing. So what? To minimize the risk of investment and profit big.
If one makes an investment portfolio, the risk may be too high. When facing the market in less favorable conditions, investments can also be destroyed.
This is the key to the effectiveness of an Investment Strategy. The most important strategy in building an effective investment lies in making a good investment portfolio. Cashflow and capital gains should be considered.
A capital gain is used to achieve long-term financial goals. But if just starting to invest, should focus to get cashflow revenue first. Once you have enough cash flow revenue then began to focus on capital gains.
The result of the capital gains would later be used to purchase assets that will generate a passive income. With so will be easier to achieve financial freedom.
If you haven’t ever had experience in creating an investment portfolio, you should consult a financial planner. Make sure we consult competent financial planner so that portfolio is made effective.
3. Implementation of investment
After being convinced by the investment portfolio are made, immediately do the implementation. Never delay investing, because we could lose a great opportunity.
Respect the investment portfolio which is already made. If you want to add to the investment capital at one of the investment products, add capital to other products also proportionally. So the proportion of each instrument in our portfolio investments is not going to change. Don’t keep changing the investment portfolio due to the later results of investment can not maximum.
Sometimes an investor affected by latest news or particular issues regarding the Investment Strategy. As a result, investors feel must vary his investment portfolio according to the issue without considering the risks that will arise. Whereas issues regarding the investment world are not always true.
4. Periodic Review
Implementation of the investment measures ‘ are not all so ‘. In the process much of the learning that we would get, especially if we are beginners in the investment world. Therefore periodic review is very important to do.
Examine everything about investment portfolios, ranging from investment practices, until the results of the investment. Make sure everything goes according to plan if there are things that are less effective make new plans. Remember, don’t be reckless in making changes, phased in the new plan until we are sure that the change was the right decision.
With the periodic review, we can find errors or things that can be better developed in the investment.
The Investment Strategy is the only way to achieve financial freedom. There are many investment strategies that can be used, but the best strategy is the result of a long process.
Investing is not an activity ‘ once so ‘. Much of the learning process that needs to be undertaken to achieve the most effective investment strategies for each of us. It is important to continue to adapt to the market so that our investment is optimized. Happy investing!