One of the most common questions I get asked as a financial planner is, ‘What is the perfect investment?’ or ‘Which investment gives the highest return?’
These may seem like logical questions, but they are actually the wrong ones to ask. Instead of focusing on the best investment or the highest return, ask yourself: ‘What are my financial goals? What do I want to achieve, and in what time frame?’
Start with the Goal, Not the Product
The key to successful investing is not about chasing the highest return—it’s about ensuring that your investments align with your personal goals. Whether you’re saving for a home, a child’s education, retirement, or simply growing your wealth, the right investment strategy starts with understanding why you are investing in the first place.
By defining your objectives, you can then select investment products and funds that will deliver the required returns while balancing other crucial factors such as:
• Risk – How much risk can you afford to take, and how much are you comfortable with?
• Volatility – Can you handle market ups and downs without making emotional decisions?
• Diversification – Are your investments spread across different asset types to reduce risk?
• Inflation – Are you earning returns that outpace the rising cost of living?
• Taxation – Are your investments structured in a tax-efficient way?
• Liquidity – Can you access your money when you need it?
The Illusion of the One-Size-Fits-All Investment
With over two decades of experience in financial planning, I can confidently say that no single investment works for everyone. The best investment for one person may be entirely wrong for someone else.
Your financial journey is unique. That’s why it’s important to focus on the person first, then the plan, and finally the product. Too many people make the mistake of starting with the product—jumping into an investment because a friend or social media influencer recommended it—without considering their own financial needs and situation.
The Danger of Comparison (Especially on Social Media)
We live in an era where social media constantly exposes us to how others are investing. You’ll see posts about people making fortunes in cryptocurrencies, property, stocks, or some new financial trend. The problem? You’re only seeing the success stories, not the failures.
Comparison is dangerous, especially when it comes to money. Your financial situation, goals, and risk tolerance are different from those of others. What worked for someone else may not work for you, and blindly following trends can lead to costly mistakes.
Emotional Reactions: The Enemy of Good Investing
Another common mistake is reacting emotionally to news headlines and political statements. Every time a politician makes a comment about the economy, the markets react—and so do many investors. This kind of knee-jerk reaction can lead to selling at the worst possible time or making investment changes based on fear rather than logic.
The key to successful investing is to stay the course and trust the process. Markets fluctuate, but history shows that well-diversified, goal-aligned investments tend to grow over time.
The Bottom Line
Instead of searching for the perfect investment or the highest return, focus on what truly matters—your goals, your plan, and a long-term strategy. Work with a Certified Financial Planner Professional who can help you create a personalised plan that suits your needs.
At the end of the day, the best investment is the one that helps you reach your financial goals.
If you take nothing else from this article, remember this: Right for me may be wrong for you. Stay focused on your own journey, and you’ll be far better off in the long run.
