With 2018 coming to a close, and mixed signals coming from economic indicators, it is a good time to plan for investing towards 2019 strategies. Most importantly, since many people are evaluating where to spend their time, and money, towards investment opportunities it makes sense to prioritize your investing options.
I’ll provide my Top 4 considerations for anyone who is conducting their annual review:
- #1: Stocks. Maintaining a strategy of dollar cost averaging can take advantage of rising and falling markets, and the fact is we can’t predict the future. Although some people may be of the belief that stocks have reached certain heights at the moment, these remain a top return on investment. One positive step to make in your stock allocation is to evaluate your mutual funds’ fee structures. Shift money away from high-fee funds and into similar funds that offer lower fees. There’s no reason to weigh down returns with high-fee mutual funds when lower cost options exist.
- #2: Real Estate. Generally non-correlated to stock markets, there are now many ways to invest in properties. Depending upon your desired level of involvement and diversification, there are many options available. Options range from direct rental property ownership to more passive investment vehicles such as Real Estate Investment Trusts and private placements. Many people are now realizing the value of diversification by “pooling” with real estate securities.
- #3: Cash. I’m a strong believer that it is imperative to hold onto cash, allowing yourself to be opportunistic in times of volatility. By having the ability to deploy cash when an opportunity presents itself, you will be in a good position for whatever may be on the horizon. With interest rates on the rise, high-yield savings accounts now offer around 2%, meaning your cash won’t be completely idle while you wait for the right opportunity.
- #4: Yourself. Adding skills and knowledge can pay great dividends for everyone. Take an opportunity to grow, provide more value to your company, add a new skill relevant to an emerging trend in your industry. This is always the case whether you are a business owner, employee or retiree – anytime you may improve yourself, simply take that step.
Of course, I personally tend to be conservative when considering long-term investments and these four strategies are being given based on my personal experience.