Comments on: Risk & Your Investment Time Horizon

By: You’re ENTITLED! « gailvazoxlade.com

You’re ENTITLED! « gailvazoxlade.com — Fri, 22 Jan 2010 10:44:35 +0000

[...] can to get all the grant to which you’re entitled. And when it comes to investing the money, make sure you’re comfortable with the alternatives you’re being offered and the timeframe until your child will need the money. If you’re not, then stick with the tried [...]

By: Colleen

Colleen — Fri, 13 Feb 2009 13:21:00 +0000

Gail,
Thanks for making a confusing subject understandable. To tell the truth I never really did understand what the risk was for investments. Thanks for putting it in plain English….a timely post!

By: Money MInder

Money MInder — Thu, 12 Feb 2009 21:53:39 +0000

By liquid, I meant accessible and not invested in volatile investments. Some people like to ladder GICs and Bonds, some people like high interest savingss accounts, CSBs or money market funds…as long is it is not in equities and you can get it if you need it….

By: Pol

Pol — Thu, 12 Feb 2009 20:06:33 +0000

Money money money! What a consuming topic, especially with speculation on future needs. I am glad Gail has laid it all out. Financial advisors can pressure people with their products and (even with good intentions) lead them to a bad-fit.
I never want to move my investments (that whole “buy,hold and prosper” line) and feel frozen by indecision… not that I need to move it right now, but I know I will in the future.
One more thing, about the high-interest savings account, the rates fluctuate there too… kinda frustrating.

By: Saver Queen

Saver Queen — Thu, 12 Feb 2009 19:33:36 +0000

Money Minder and Marie – good points – I think a combination of high interest accounts and short term investments are good places to keep your money if you’re going to need it in the next 5 years. However I did notice that lately high interest accounts seem to be higher than most GICs! Of course, with savings rates steadily falling, this may change

By: Marie

Marie — Thu, 12 Feb 2009 16:47:38 +0000

Money Minder:
There is a difference between ‘liquid’ and ‘not in stocks’. If you need in 5 years, it’s ok to put it in GICs. If you need it any time during the upcoming 5 years, then you should choose a secure investment which gives access to your money any time (high interest account…).

By: Money MInder

Money MInder — Thu, 12 Feb 2009 15:53:58 +0000

Any money that you are going to need in the next five years should be liquid and not in equities.

Revisit your plan once per year and make sure you have 5 years of cash available. Depending on your retirement expenses, you may find you need need to increase or decrease the amount depending on your annual spending plan, health and travel plans. but, if you will need it within 5 years – it should not be in stocks!

By: Saver Queen

Saver Queen — Thu, 12 Feb 2009 15:29:35 +0000

Erran, thanks for your comment yesterday (I’m sure you noticed that it did get published – Gail moderates any post with a link in it to make sure we’re not sending her readers off to porno sites!

By: Geoff

Geoff — Thu, 12 Feb 2009 15:13:52 +0000

Minor note on Erran’s posting re: “if you’re 5 years away from retirement (give or take) then get out of equities (or at least such that you have minimal exposure)” — I think it depends on your investment strategies. If you’re not planning on pulling all your money out the day you turn 65 and/or have invested heavily into dividend paying stocks and expect to live off dividends, you don’t necessarily need to get out of equities entirely when you retire. But Erran’s and Gail’s points are exactly on target — be aware of your horizons at all times.

By: Erran

Erran — Thu, 12 Feb 2009 14:58:12 +0000

Woohoo…exactly like my blog response yesterday. Copycat…just kidding. But yes, people always have to be aware of purpose & timelines when it comes to their investment strategy. One can never be lazy, and it can be as simple as checking over your portfolio once a year and asking yourself does your current strategy/risk fit with how much time you have left for whatever objective you have. As I said yesterday, if you’re 5 years away from retirement (give or take) then get out of equities (or at least such that you have minimal exposure). Now keep in mind, that just because you’re at 5 years, you hit the brakes and pull out. Market conditions also have to be considered. If you’re going to lose pulling out at 5 years then you may need to wait another year or two to switch strategies. Likewise if the markets are on a roll, you may want to wait a year or two to get some more upside while things are good, but you can’t wait too long! Who would have thought the markets would have crashed 30-40% in a span of a few months…