1. Define Your Investment Goals & Objectives
  2. Define Your Investment Strategy for Your Portfolio
  3. Building Your Own Portfolio to Match Your Goals
  4. Monitoring and Rebalancing Your Portfolio
  5. The Bottom Line
  6. 401(k)s
  7. Exchange Traded Funds (ETFs)
  8. IRAs and Roth IRAs
  9. Mutual Funds
  10. 529 Plans
  11. Stocks
  12. Life Insurance
  13. Bonds
  14. Annuities
  15. Health Savings Accounts (HSAs)

After you define your goals and figure out how much money you need, the next step is to work on an investment strategy that will make it happen. An investment strategy is basically a plan of attack that guides your decisions based on your goals, risk tolerance, and future needs for capital. Some keys to making a sound investment strategy:

A little more about diversification: One of the best ways to meet your financial goals is by putting your money in a variety of investments – known as diversification – so that you can balance risk and return. This is the proverbial “don’t put all your eggs in one basket” idea: If you invest all your money in one stock, for example, what happens when that company goes belly-up?  

Ideally, you should diversify within asset classes – for example, by choosing an index fund that covers a chunk of the market instead of just one or two stocks – and across asset classes, by investing a percentage of your savings in each of the asset classes (stocks, bonds and cash).

Of course, the more you know about your investment options, the better decisions you can make. In this chapter, we’ll take a look at some of the retirement and tax-advantaged accounts out there that you might incorporate into your investment strategy. We’ll look at specific investments – such as stocks and exchange traded funds (ETFs) – in the next chapter.


Building Your Own Portfolio to Match Your Goals
Related Articles
  1. Personal Finance

    5 Ways to Be Smarter With Your Money

    These five strategies can help you meet the financial goals you desire.
  2. Retirement

    Follow the Key Steps of Retirement Planning

    To achieve your retirement goals, don't skip over the important steps in financial planning.
  3. Retirement

    Six Critical Rules for Successful Retirement Investing

    Understand which investment vehicles and strategies build you the most fiscally sound retirement.
  4. Small Business

    Investment Portfolio Management for Entrepreneurs

    Investment information and strategies for entrepreneurs.
  5. Investing

    7 Steps To Start Investing Safely

    Do you want to start investing, but don’t want to take on too much risk? Find out how to start investing safely.
  6. Investing

    4 Behaviors That Sabotage Your Investment Goals

    If you can't figure out why you're not achieving the returns you want, these behaviors might explain why.
  7. Financial Advisor

    The Virtues of Being Financially Organized

    A broad financial plan requires a considerable degree of organization and a true understanding of your risk tolerance.
  8. Investing

    Diversification: The Right Way to Manage Risk

    Diversifying your portfolio across multiple asset classes will help you minimize investment risk.
  9. Investing

    Diversify Your Portfolio With These 6 Essential Steps

    Follow these six essential steps to create a diversified portfolio within your risk tolerance.
  10. Managing Wealth

    Become Your Own Financial Advisor

    If you have some financial know-how, you don’t have to hire someone to advise you on investments. This tutorial will help you set goals – and get started.
Frequently Asked Questions
  1. Which Schools Did Warren Buffett Attend?

    Warren Buffett attended multiple prestigious schools on his path to success, but he places much more significance on real-world ...
  2. What are some examples of expansionary monetary policy?

    Learn about expansionary monetary policy and how central banks use discount rates, reserve ratios and purchases of securities ...
  3. What is the role of the nation-state in globalization?

    Learn about the evolving role of the nation-state in an increasingly globalized world as fewer boundaries restrict international ...
  4. What are some examples of positive correlation in economics?

    Learn the most common examples of positive correlation in macroeconomics and microeconomics, including demand and price, ...
Trading Center