Destination KSA - Your Guide to Saudi

Destination KSA - Your Guide to Saudi
Online Magazine

Financial Planning With Reem Asaad – Investment Objectives

By Destination

Share

facebook linkedin telegram whatsapp

In the investment management industry, it is normally mandated that advisers know their clients. Part of this process involves gathering information about the investor’s experience, financial background (i.e.net worth and annual income) and investment objectives. Most people confuse saving objectives with investing objectives. When it comes to saving, an investor must identify shortterm goals such […]"

Financial Planning With Reem Asaad – Investment Objectives

In the investment management industry, it is normally mandated that advisers know their clients.

Part of this process involves gathering information about the investor’s experience, financial background (i.e.net worth and annual income) and investment objectives.

Most people confuse saving objectives with investing objectives. When it comes to saving, an investor must identify shortterm goals such as summer vacation or home repair, and long-term goals such as marriage and family, buying a home, funding college for children or retirement needs. However, investing objectives involve designing an investment plan according to our financial (saving) goals. For example, if you are in your 30s and have an objective of saving for children’s college, your priority would probably be growth.

Most textbooks divide key objectives into three types:

1. Safety Suitable for retired individuals and near retiring individuals, especially those without a steady income.

This objective prioritizes the preservation of capital by avoiding high-risk investments and favoring safety -albeit low returnof the invested capital.

2. Income Suitable for those who will need the money in less than five years.

They allocate the portfolio towards more conservative, income-producing securities such as high-dividend stocks or short-term bonds.

3. Growth Suitable for investors with a time frame of more than 10 years who would then take a higher degree of risk by investing more aggressively in growth-oriented stocks.

 


Once identified, based on life goals and needs, these objectives are usually incorporated into an investment strategy, which is a road map to how your money is invested in practical terms. Most investors will aim for more than one of these objectives at some point in their lives.

For example, you may plan to buy a new house in three years to invest for your children’s college education in 15 years, or to fund your retirement in 30 years. Tax minimization and liquidity are other objectives referred to as secondary objectives. Most governments impose income taxation. However, there are certain investment strategies that help minimize the size and impact of taxation on the overall value of the portfolio.

Finally, liquidity refers to the ability to obtain cash as soon as needed and it can be very critical to certain investors with carefully drafted financial plans and short-term goals.


Reem Asaad
The Author:
Reem Asaad is an inspirational Saudi woman. She is a wife, mother, writer and financial adviser. Asaad was ranked the third most powerful Arab Woman in 2012 by Arabian Business Magazine.
Email: Nasi7atreem@gmail.com
Instagram: @Nasi7atreem
Twitter: @Nasi7atreem


Share

facebook linkedin telegram whatsapp

Keep Exploring

Saudi Arabia Secures Hosting the 2026 FEI World Championships in Al Ula

By Mohammed AlMahdaly

Ring of Fire: Tyson Fury vs. Oleksandr Usyk in a Historic Showdown

By Haneen.Sh

Explore Culture At Al-Suwaidi Park

By Haneen.Sh

Epicon: NEOM Unveils its Luxurious Coastal Destination

By Haneen.Sh

Experience Enchantment at Disney: The Castle, Riyadh Season 2023

By Haneen.Sh

Get Ready: Tickets for Saudi Games 2023 Available Now

By Haneen.Sh

Discover ROKA Riyadh’s New Family-Friendly Brunch Experience

By Haneen.Sh

All You Need To Know About Riyadh Season’s Wonder Garden

By Haneen.Sh

Riyadh Zoo 2023 is Back For its Second Edition

By Haneen.Sh

BLVD Forest: an Interactive Setting to Delve into Natural Wonders and Encounter Rare Wildlife

By Mohammed AlMahdaly

Invisibilia Experience: Contemplative Spaces and Interactive Challenges in Boulevard City

By Mohammed AlMahdaly

Luxury Retreat at Rosewood Jeddah

By Haneen.Sh

GCC States Announces Unified Tourist Visa

By Destination

Lang Lang’s Spectacular Piano Performance at Ithra Theater This Winter

By Haneen.Sh

Diriyah Season 2023/2024: Events Across Four Zones Unveiled

By Destination KSA

Mike Tyson’s Boxing Club Opens Registration for Boxing Talents

By Haneen.Sh