All of us know we have
to save and invest if we want to achieve our financial goals. We diligently
penny-pinch to save money and invest in various financial instruments like bank
fixed deposits, company deposits, bonds, mutual funds, stocks and so on.
However, according to financial pundits, most of these 'invest-as-you-go' portfolios don't really deliver the goods. It is mainly because the portfolio is nothing but a host of stuff put together - mostly at the advice of some friends or colleagues or on the basis of the market performance - without a proper thought.
Worse, most people don't even bother to track their investments regularly or restructure or rebalance the portfolios accordingly.
"Such portfolios typically include too many products which are difficult to track. There is also no thought behind most of these portfolios and these may not be helpful in achieving the financial goals of investors," says Vishal Dhawan, founder, Plan Ahead Wealth Advisors.
However, this is not to suggest that if you have invested your kitty in such a portfolio you are doomed. You can always take stock of the situation and take remedial measures. Of course, it indeed comes at a cost, and most importantly the lost opportunity cost.
"Make a list of investments you have in your existing portfolio and articulate your financial goals in money terms along with time lines," says Uday Dhoot, deputy chief executive officer atInternational Money Matters.
The first step of taking stock of investments can be done by going through your investmentrecords. For the purpose of quantifying the financial goals you can either use an excel sheet (if you are savvy enough to use it) or use financial calculators offered by various websites.
Once you have goals and the time to achieve them on paper, tally them with your investments to make sure that you have the right investments to meet your goals. For example, fixed deposits and relatively safe investments, such as short-term bond funds and fixed maturity plans, can be used to achieve short-term goals.
Diversified equity funds with good track record can be aligned with long-term goals. This process will ensure that you switch to goal-based investments from random investments.
However, according to financial pundits, most of these 'invest-as-you-go' portfolios don't really deliver the goods. It is mainly because the portfolio is nothing but a host of stuff put together - mostly at the advice of some friends or colleagues or on the basis of the market performance - without a proper thought.
Worse, most people don't even bother to track their investments regularly or restructure or rebalance the portfolios accordingly.
"Such portfolios typically include too many products which are difficult to track. There is also no thought behind most of these portfolios and these may not be helpful in achieving the financial goals of investors," says Vishal Dhawan, founder, Plan Ahead Wealth Advisors.
However, this is not to suggest that if you have invested your kitty in such a portfolio you are doomed. You can always take stock of the situation and take remedial measures. Of course, it indeed comes at a cost, and most importantly the lost opportunity cost.
"Make a list of investments you have in your existing portfolio and articulate your financial goals in money terms along with time lines," says Uday Dhoot, deputy chief executive officer atInternational Money Matters.
The first step of taking stock of investments can be done by going through your investmentrecords. For the purpose of quantifying the financial goals you can either use an excel sheet (if you are savvy enough to use it) or use financial calculators offered by various websites.
Once you have goals and the time to achieve them on paper, tally them with your investments to make sure that you have the right investments to meet your goals. For example, fixed deposits and relatively safe investments, such as short-term bond funds and fixed maturity plans, can be used to achieve short-term goals.
Diversified equity funds with good track record can be aligned with long-term goals. This process will ensure that you switch to goal-based investments from random investments.
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