Investing

5 investing principles that are built to last

Develop a financial game plan

First, establish clear, attainable goals and create a plan that will help you reach them. Be conservative in your projections about how fast your money will grow. By avoiding impractical saving or spending requirements, you can help keep your plan on track.

 

Become a disciplined saver

4 key words for building a secure financial future are “live below your means.” Make a habit of putting money away. If saving money doesn’t come naturally to you, find creative ways to make it a fun challenge. Consider what changes you’re willing to make to set aside a little more for your future.

 

Invest with balance and diversification

Create a sound investment strategy by choosing an asset allocation that uses broadly diversified funds and considers your goals, time horizon, and risk tolerance.

 

Control your costs

While you can’t control the markets, you can control your investment costs and taxes.

The less you pay for funds, the greater your share of the investments’ returns. Be sure to avoid funds with high expense ratios. The average Vanguard mutual fund and ETF expense ratio is 83% less than the industry average.*

To reduce taxes, consider tax-efficient investments like index mutual funds and ETFs. IRAs are another way to mitigate the impact of taxes.**

 

Maintain a long-term perspective

Over time, you’ll experience both good and challenging times that can evoke various emotions. Resist the urge to make impulsive decisions. Taking a disciplined approach that keeps you focused on your long-term objectives is a winning strategy for all seasons.

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