Investing in financial freedom

Martin Riekert

Rising fuel prices, a recovering economy, and record-high levels of unemployment have all added undue stress on our ability to progress towards financial freedom. What does it mean to be financially free? It means paying off your debts, building a savings safety net, and ultimately, creating a passive income through smart investments choices – preferably before you retire

Martin Riekert - Executive Head of Retail Investments from Momentum Investments believes there is hope for many South Africans, but it starts with focusing on what it means to make smart investment choices. “Your investment strategy needs to reflect your life goals but must also be linked to your tolerance for investment risk. Whether it’s a new car, a new house, your kid’s education fund or a retirement savings fund, it is up to you how deep and how far you are willing to go to reach these goals.”

Riekert says investing is how you take charge of your financial security. It allows you to grow your wealth and generate an additional income stream if needed ahead of retirement. To do this, Riekert says planning is key.

By creating a financial plan, Riekert says you should be able to determine your short, medium, and long-term financial goals and then create a balanced plan that should help you achieve them. He says this should always take into account your financial circumstances, future goals and all factors that may change over time.

However, even with the right goals, Riekert says our behaviour can be our greatest enemy on the road to financial freedom. “You have specific needs, and you often think you need a particular investment, but when it doesn’t perform according to your expectations immediately, you get nervous. The smart investment choice to make would be to stay the course.”

He says staying the course is the most prudent way to invest towards a passive income that will ultimately provide some sense of financial freedom.

“People tend to look at arbitrary benchmarks, compare their investments to those and then act against their own best interest,” says Riekert. “Maybe you’ve had to pull your money out of a risky investment loaded with shares when your bullish sentiments turned nervous. Whatever the reason is, it is important to stick to your guns as investments are a long-term game and require resilience to be realised.”

Of course, it is the best investors who place their trust in a financial adviser or an investment firm to do the heavy lifting for them. “By leaning on experts who have dedicated their lives to investment success, you can accelerate your success by pushing the boundaries through innovative and tailored solutions that can help you achieve your goals on your investment journey,” concludes Riekert.