As soon as they step into the investment sector, many people...

As soon as they step into the investment sector, many people ask, “What should I buy?”

At this point, the most important question they should ask themselves is, “What are my investment goals?”

Many people have vague investment goals: “Bank current interest is too low, I want to find products with higher returns”, “My old students are investing in fixed funds, and I want to invest too”, “Recently, the stock market has soared, so I have to keep up with this wave as soon as possible”...

If you set such an investment goal, then it would be very troublesome. Because there is so much to choose from, looking at the variety of products you won't be able to get started.

You've definitely had a similar experience in your life. Originally, you only wanted to buy a jacket, but when you arrived at the mall, the dazzling array of new, classic, and retro models of the season left you with no choice; you didn't know which one to buy. There is a specific term for this in psychology, called “decision paralysis.”

If you want to avoid “decision paralysis,” you need to set more precise goals. If you set a precise goal, for example, if you want to buy a fleece denim short jacket, then you will automatically filter out some products that should not be included in the decision at the mall, and of course it's much easier to choose.

The same goes for investing. Setting clear investment goals can help you make better investment decisions.

How do you count as clear investment goals? Of course, the more specific the better. Depending on your investment goals, the right products for you will vary.

An investor's investment goal should include three elements: return, time, and risk.

Let's first look at earnings.

This is easy to understand; it is your goal in terms of return on investment. For example, there are three common revenue goals:

1) Outperform inflation and get 4% to 6% profit;

2) Get a small profit and get 8% to 10% profit;

3) Significant results, with an annualized yield of more than 20%.

1) It is a relatively easy goal to achieve. You can choose to place your assets in stable products such as monetary funds, bank financial management, and bond funds. People with this kind of goal are usually “lazy people” in financial management. Their income and assets are pretty good, and they don't want to spend too much energy on financial management themselves.

2) is a relatively realistic goal. However, if you want to achieve this return, you must stick to long-term investment, because the actual return will fluctuate continuously. It may be 17% this year, 5% next year, and 9% the following year. Over the long term, it may stabilize at around 8% to 10%.

3) It's easy for some people; it's probably just a matter of buying a house and covering it for a year or two. But in reality, this is a very unrealistic goal; stock god Buffett's long-term yield is slightly higher than this figure. It's hard for the average investor to find a mass investment product that can maintain this rate of return for more than 10 years. Therefore, it is easy to achieve this kind of profit in the short term, and very difficult to achieve in the long term. If someone tells you they can recommend a product that can achieve 20% or more profit over a long period of time, don't doubt it; it must be a scammer.

Now that we've talked about benefits, let's talk about risk and time.

If your risk tolerance is low and the investment period is relatively short, you can choose products such as monetary funds, bank wealth management, and bond funds. If you have a high risk tolerance and a long investment period, then you can consider highly volatile products such as hybrid funds, equity funds, and stocks.

How do you assess your ability to take risks?

Risk tolerance is mainly related to three factors: wealth, expenditure, and age. People with more wealth, people with abundant financial flows, and young people will be more resilient to risks overall; they can withstand short periods of time