Monday, January 2, 2017

A Garden of Funds

Think of your investments as a garden. You hope it will flourish and grow. It probably contains at least a few types of vegetables (funds).  Just as it is important to choose vegetable varieties relevant to your climate and soil, a good choice of funds for you is determined by your personal situation.

While a few people hire a gardener to do the work of maintaining their garden, most they take care of the garden themselves. While at times this can seem drudgery, most of the time gardening is rewarding.

We feel the same is true for investments: most people are capable, with a bit of research and education, of making good investment decisions. While occasional advice from a professional financial advisor is always wise, we feel that  you should feel in charge of your own investments.

Ultimately better decisions are made when you have educated yourself financially. The effort that we plan to put into this blog, and associated Twitter account, is based on the belief that investment education is important. We will not offer formal investment advice, and urge you to seek appropriate financial planning and investment advice, but we do hope to contribute to your investment education.

In the same way that sometimes a garden will perform beyond your expectations, sometimes an unforeseen event like a drought or severe storm will cause unpredicted damage to your investments. Part of feeling in charge of your own investments is to be emotionally ready for the unexpected.

Having diversification, a collection of different types of investments, will help you weather financial storms, in the same way that not growing only a single crop will make it less likely that you have a disastrous gardening season.

In my children, and now in my grandchildren, I see their joy when growing vegetables themselves.  Feeling empowered to understand and grow your own investments can be positive. Let's learn together.

This posting is intended for education only. The reader is responsible for their own financial decisions.  The writer is not a financial planner and reading this column should not be interpreted as obtaining individual financial planning advice. For major financial decisions it is always wise to consult skilled financial professionals. While an effort has been made to be accurate, any statements of fact should be independently checked if important to the reader.