From the course: Managing Your Personal Investments

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Setting goals and your risk tolerance

Setting goals and your risk tolerance

From the course: Managing Your Personal Investments

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Setting goals and your risk tolerance

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- Setting goals is a vital step for every investor, but when I hear investment companies ask, "What's your retirement number?" I cringe. "How much do you need to retire?" they ask. My answer is, "As much as humanly possible." In my mind, they're asking the wrong question. You should never set a target until you take a good look at who you are and what your needs are. Once you do that, you're going to learn what kind of investments you should make and how much risk you should take on. Only then can you begin to set goals. So let's look at you and begin with your investment objectives. Objectives may sound like the same thing as goals, but they're slightly different. Your objective should be a general idea of what you want to get out of your investments. Do you want to generate income that you can use to live off? Do you want to grow your savings base for later? Or do you want to grow as quickly and as much as you can? Or do…

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