5 investment goals to set for yourself
Updated 
5 min. read
Investing can seem overwhelming at first, but it doesn’t have to be. By breaking it down into simple achievable goals, you can make investing manageable.
You probably already set goals in your personal life all the time, so just apply the same process to your investing goals. Your overall goal might be to run a marathon, but if you’re just starting out then you should probably start with a more manageable short-term goal like running 5 kilometres. And if your goal is to go on your dream trip with your friends, buy your first home, or retire on your own terms, then break it down into smaller achievable investment goals like making a budget, or investing a small amount each month.
Here are five investment goals to help you get started:
1. Look at the big picture and make a plan.
Before you start investing, you should take a look at your overall financial picture. Start by categorizing your spending and income. Here’s how to break it down:
First, calculate how much you earn per month (after tax).
Next, split your spending into two categories “essentials” (like rent, transit, hydro and food) and “nice-to-haves” (like movies, and entertainment).
Then subtract your spending from your earnings.
If you finish the month with money left over, you’re ahead of the game. Use this money to save for your emergency fund (three to six months’ of living expenses) and fund your long-term investments. If you end up in the red, well, it’s time to take another look at your spending habits. Find out where you can cut costs so you can boost your savings.
Now that you know how much you’re working with, it’s time to come up with a plan.
2. Educate yourself about investing.
As they say, knowledge is power. Commit to learning about how investing and the market work. Learn about products (like mutual funds, GICs, and E T F ), plans (like an RRSP, TFSA, RESP, or RDSP) and online investing services (like Smartfolio or InvestorLine). B M O offers tons of free resources for new investors through the InvestSmart learning centre.
Newbies can become savvy investors with just a little bit of work. Even better, all the information you need can be found right at your fingertips online. If you prefer to curl up with a good book, flip through the Little Book of Common Sense Investing by John C. Bogle or The Wealthy Barber Returns by David Chilton. Your future self and your bank account will thank you.
3. Invest in your future today.
The earlier you start investing, the longer your money has to grow. Plus, thanks to compound investing (which means that every dollar your investments earn is automatically reinvested) small savings become a big nest egg. Crush this goal by aiming to invest 10% of your income into an RRSP or TFSA. If you make $52,000 per year then 10% of your monthly salary would be about $433.
Tip: It’s never too late to start investing – but the earlier you start, the better!
4. Invest automatically.
If you’ve ever said to yourself “I can’t afford to invest” or “I’ll start investing next month,” then don’t worry, we’ve got a simple solution – a Continuous Savings Plan (CSP) from B M O . You can set up auto-deposits into your investment accounts (like your T F S Aor RRSP). Think of it as a “set it and forget it” investing.
For example, you can automatically move $200 from your savings to your R R S P every month. That way, you can make savings part of your routine, and help build your wealth effortlessly – whether you’re saving for retirement, your child’s education or another financial goal that’s important to you.
5. Earn more, invest more.
What if you made an extra 10%, 15%, or more? How would that change your financial life? It may sound difficult, but making more money is an achievable financial goal and there’s more than one way to approach it. For example, you could raise your income by:
- Starting a side hustle
- Negotiating a raise at your job
- Selling your old stuff
Talk to a pro
Still not sure where to start on your investing goals? Don’t be afraid to seek guidance from a professional. You probably see the doctor once a year to check your health, so why not meet with a financial planner to check up on your finances, too?
Ready to open a BMO InvestorLine Self-Directed account?
Complete your application and start investing online.
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