Building a good retirement pot is simple in
theory. You put away some of what you earn every month from as early as you can,
invest it wisely and then let compounding do its work. The trouble is, life often gets
in the way – paying the mortgage, fixing the car, supporting the kids. This can prevent
us saving as much as we could.
When we do save or invest, we can also make mistakes. Too much cash will not
protect against inflation. We may take more risk than we can really afford with the
investments we choose. Money may remain in underperforming investments long
after it should in the hope of a recovery, or it may be transferred out at the first sign
of adverse market behaviour, leading to losses over the longer-term.
A common mistake is not talking enough about our finances. Many people still don’t
make a will, or forget to say who they want to receive their pension pot after they die.
No-one likes to contemplate death, but it is important for sound financial planning
and you can read more about this here.
Successful long-term wealth planning is as much about building good habits as it
is about choosing the right savings and investments. It’s also about avoiding bad,
potentially wealth-destroying habits. We’ve designed a checklist to help you focus in
this area and you’ll find it here.
By overcoming any bad investing habits and building on your good ones you can
become a smarter long-term saver and investor.
Please remember the value of your
investments and any income from
them can go down as well as up and
you may get back less than the
amount you originally invested.
All investments carry an element of
risk which may differ significantly. If
you are unsure as to the suitability
of any particular investment or
product, you should seek
professional financial advice.