This article is part of Morningstar’s Guide to Investing Ideas for 2016, click here to get your financial health in order with some new year’s resolutions for your portfolio.
People are often afraid to make New Year’s resolutions as they doubt their ability to stay on target. But the fact is having New Year resolutions for your finances can help prepare yourself to pay unpredictable expenses in the coming year and make it more likely you will reach your savings and investment goals. January is a good time to review where your money goes.
Advisers suggest setting up a budget sheet to calculate your monthly expenses from income. For people who have savings with a high street bank, compare the interest rates of different banks to make the most of your savings account.
Investors should be careful not to put all their eggs in one nest; diversified asset allocation will help minimize your risk and boost returns. It is a volatile market out there – and when markets are low investor confidence is also low, so they often do not invest until markets have recovered and confidence returns. Yet dips are a good opportunity for long term investors to get in cheaply and benefit from any market recovery.
Most of the young people fail to see the urgency to invest or save for retirement. But with soaring medical care costs, low interest rates and volatile global economy, even the richest people in society are now worried about not having accumulated enough money to last throughout their retirement. It is never too early to start saving for the golden years.
We took to the streets of London to find out whether the public had any New Year’s resolutions and what their financial goals were for 2016.
