Thinking of investing for the first time, or would you like to take your existing investing to the next level?

Here are some basic building blocks to develop an ‘investor mindset’ and keep it working for you, with the help of a SHARE financial adviser.

Think long-term

Perhaps, nothing can illustrate this concept better than a famous quote by legendary investor Warren Buffett: “Someone’s sitting in the shade today because someone planted a tree a long time ago.”

People turn to investing to achieve a number of different goals – to save for retirement, to be financially independent or to secure their family’s financial future.

Whatever your goal is, make sure you stay on course: investing is a long-term process. Inevitably, the markets will go up and down, but in the long turn, they tend to rise. And with the added benefit of compounding interest on interest earning investments, the longer you remain invested, the greater the probability of achieving positive results.

Have a plan and stick to it

Investing isn’t a one-size-fits-all approach. As we said, everyone has different investment goals, so it’s important to have a plan in place that meets your own personal needs and circumstances. Working with a SHARE adviser can help you devise a strategy that’s designed around your tolerance for risks, objectives and budget.

On this note, one common misconception is that investing is just for the wealthy. In fact, it’s for anyone who’d like to have their hard-earned money working harder for them and for their goals.

Other people think that investment is just too difficult or risky for them. The reality is, there are investments available at all risk levels. The key thing is to align your strategy with your attitude to risk (the risk you’re comfortable to take with your money and investments), investment horizon, and goals.

Like to explore your options? Get in touch with a SHARE adviser – we’re here to help you put in place a well-thought-out plan and stick to it, keeping you focused on your objectives.

Keep your emotions in check

As humans, we’re emotional by nature. But when it comes to investing, it’s best to keep emotions out of the equation as much as possible.

According to research, the more complex the choice and more uncertain the subject matter, the more emotions tend to influence our decision-making. Periods of market volatility can trigger emotional responses in investors, so it’s important to remember that ups and downs of the sharemarkets are a normal part of the investing journey.

Like to keep your emotions under control? The first step is to understand your attitude to risk and choose your investments accordingly. Diversifying your portfolio can also help you manage volatility and risk more effectively (more on this in a second).

On top of that, learning to ‘stay cool’ when your balance takes a dip is key. Once again, keep in mind that you’re invested for the long haul, and that over time your balance is likely to recover. Investing is all about time, not timing the market.

If you’re looking at investing with confidence, get in touch: Having a SHARE adviser in your corner can help you keep perspective and make informed decisions every step of the way.

Diversify your portfolio

Like to mitigate the level of volatility in your investment portfolio? Diversification is one of the keys. It’s the strategy of spreading out your money into different types of investments, which generally reduces the risk while still allowing your money to grow.

Investment always involves some risk – the higher the risk of losses, the more likely you are to achieve better returns in the long term. By diversifying where your money is going, you’re mitigating risk and taking a more balanced approach to building wealth.

Of course, there are many types of investments to choose from: A SHARE financial adviser can help you select an appropriate mix of investments for your financial needs.

Get in touch

At SHARE, we specialise in helping New Zealanders secure their financial future. Please don’t hesitate to contact us if you’d like to explore your investment options. We’re here for your questions. Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.