Investment Strategies for the New Year: What to Watch Out For
With the commencement of the New Year, you’ve likely crafted a list of resolutions for 2024. Yet, these aspirations often fade into the background as the months unfold. To break this pattern, particularly concerning personal finances, and setting investing strategies in advance is crucial.
Investing can offer an additional income stream, support your retirement plans, or serve as a buffer during challenging times. Most importantly, investing fosters wealth growth, aiding in the achievement of your financial objectives and bolstering your purchasing capacity over the long term.
“It’s not an easy time to be an investor, but at David Lerner Associates, we believe that strategic planning is the key to navigating the dynamic landscape of investments,” says Scott Mass, Senior Vice President, Investments at David Lerner Associates, Inc.
2023 is in the rearview mirror and it’s time to focus on 2024. In this guide, we’ll explore crucial investment strategies to watch out for in the coming year, ensuring that your financial goals align with the ever-evolving market.
1. Prioritize Investments Based on Your Financial Goals
Does a 65-year-old retiree invest in the same way as a 35-year-old professional in the prime of their career?
The clear answer is no.
Investment strategies should align with your goals and their respective timelines. Whether you’re aiming for short-term gains or building a robust retirement portfolio, align your investments with your objectives.
Financial advisors work closely with you to understand your goals and tailor investment plans that meet your unique needs.
2. Automate Investing
A mere 57 percent of Americans possess some type of retirement savings, as reported in a recent survey by online wealth management platform Personal Capital.
Simplify your investment routine by automating contributions to your investment accounts.
This not only ensures consistency but also takes advantage of dollar-cost averaging. Regular, automated contributions allow you to buy more shares when prices are low and less shares when prices are high, potentially mitigating the impact of market volatility.
3. Consider Using an Investing App
Embrace technology to enhance your investment experience.
Investing apps provide real-time market insights, portfolio tracking, and user-friendly interfaces.
Investment advisors stay at the forefront of technological advancements, guiding you in incorporating the right apps into your investment strategy.
4. Eliminate High-Interest Debt
Before diving into new investments, address debt.
Maybe your holiday shopping ended up increasing your credit card balances more than you expected. Reducing outstanding debts, especially those with high interest rates, frees up resources for strategic investments.
A financial advisor can assist you in creating a debt repayment plan that aligns with your broader financial goals.
5. Reevaluate Your Insurance Coverage
A September 2023 Census Bureau report revealed that 26 million Americans, constituting 7.9 percent of the population, were without health insurance.
A comprehensive investment strategy includes a review of your insurance coverage. Ensure that your life, health, and property insurance align with your current and future circumstances.
Regular reassessment guarantees that you’re adequately protected against unforeseen events, providing stability to your overall financial portfolio.
6. Don’t Forget Uncle Sam
Taxes are an inevitable aspect of earning, directly influencing both your income and investment returns through capital gains tax.
Neglecting tax planning can pose significant financial challenges. Therefore, as the New Year begins, it’s crucial to prioritize and address your tax-related considerations.
Stay informed about tax implications related to your investments. Optimize your portfolio to minimize tax liabilities, and explore tax-efficient investment options.
7. Assess Your Investment Mix
Financial markets, stock prices, and asset classes evolve, and so should your investment mix.
This year, for instance, hasn’t been kind to the financial markets.
This suggests that the distribution of different financial assets, as initially outlined in your investment strategy, may no longer align with the current state of that plan.
Review your investment portfolio to ensure that it aligns with your risk tolerance and financial goals. Consider diversification across different asset classes to enhance resilience in the face of market fluctuations.
Conclusion
Economic uncertainty calls for cautious investment strategies.
As you step into the New Year, seize the opportunities that strategic investing presents. At David Lerner Associates, we are committed to helping you navigate the intricacies of the market with confidence.
By prioritizing goals, embracing automation, leveraging technology, managing debt, reassessing insurance, considering tax implications, and maintaining a diversified portfolio, you set the stage for a successful investment journey.
Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable– we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.