Investment Portfolios

How to Construct an Investment Portfolio

Ask yourself these questions:

A: What are my personal financial goals? Are you saving to buy a car, a home, or for your retirement? Whatever your objective, write it down because this is your starting place.

B: What is my time frame? If you are saving for retirement … take into consideration if you’re an early, mid or late starter. Calculate how many years you have until your retirement date or other financial goal you’re attempting to attain.

C: How much do I want to invest? If you’re saving toward this goal on a monthly basis, calculate how much of your monthly income you’re willing to put aside.

D: What is my risk tolerance? Are you a conservative, moderate or aggressive investor? Figure out what you feel comfortable investing and start from there.

When you’ve completed parts A through D, you’re ready to take the steps toward creating an investment portfolio. Seek further help from a financial professional like a financial planner. A financial planner looks at your finances as a whole and helps map your goals accordingly.

It is key that your portfolio be diverse, with a good investment mix. Seek to place your money not only in stocks and bonds and other securities, but also in cash and CDs.

Once your portfolio is complete, revisit it once per year or when there are any significant life changes.