Today’s question is: What are the top three financial terms everyone should know?
Number one: Fiduciary
Fiduciary is a term we’re seeing regularly in the media. What does it mean?
Make sure you find a firm that’s held to the industry’s highest standard. As a fiduciary, that firm is legally and ethically required to always act in your best interest.
Number two: Diversification
Make sure not all of your investments are moving the same direction. You should have some of your money designed to grow, some of it designed to generate income, and lastly, some of your portfolio in safe secure investments.
Diversification means having the right mix of those three different areas to accomplish your specific goals.
Number three: Rate of Return
Why does that matter? If you’re in my office and you say, “David, I made 10% on my investments last year. Is that good or bad?” Well, if you only needed to make 5%, maybe you’re taking a little too much risk. If you needed a 12% rate of return, then you’re not on track.
So, it’s important to get a true understanding of the required rate of return that you need. That way you can better judge the performance of your investments and make sure you’re on track to meet your financial goals.
Information presented in our podcasts is considered current as of the created date. Over time, some information presented may become stale. We recommend you consult with your Financial Professional before making any changes based on information contained here.
Johnson Brunetti is a marketing name for the businesses of JB Capital and JN Financial.
Investment Advisory Services offered through JB Capital, LLC. Insurance Products offered through JN Financial, LLC.
