Before we start discussing returns, you might be wondering why you should take financial advice from the Oxford Club. First and foremost, the Oxford Club is one of the largest private networks of knowledgeable and trustworthy entrepreneurs and investors globally. The Club’s goal is to help its members grow and protect their wealth with highly effective and useful financial advice.
Oxford Club members don’t get financial advice from mainstream media like typical investors. Instead, the Club offers its member the best investment and business opportunities through personal connections. The Club’s management and membership is made up of strategists and true experts in all fields of business and investment.
One such expert is Alexander Green, the Chief Investment Strategist at the Oxford Club. Green has three simple steps for increasing returns in 2018 regardless of market movements. He acknowledges the fact that financial markets don’t have guarantees. 2017 offered great returns for equity investors. But 2018 can offer even higher returns if you follow the three simple steps discussed below.
Step 1: Save more
Saving more will guarantee you higher returns in 2018. Unfortunately, most people have poor saving methods. According to the most recent Retirement Confidence Survey, millions of Americans aren’t prepared for retirement simply because they don’t have enough savings. The 2017 survey shows that 24% of Americans have less than $1000 in retirement savings currently and nearly 50% have less than $25,000 in savings.
What’s more is most Americans believe they will be taken care of by the government yet Social Security amounts to approximately $1,360 per month for the typical retired worker or $2,069 when you include spousal benefits. Such an amount isn’t nearly enough to offer the kind of lifestyle many Americans envision after retirement.
This is precisely why you must start saving seriously in 2018 if you want higher returns and a comfortable retirement. You should start saving as much as possible, as soon as possible. Saving is a great strategy since it is under your complete control unlike the performance of financial markets.
Green has been an avid saver despite enjoying the finer things in life in his 20s like most Americans. He admits to embracing a saving culture having been terrified of the consequences of failing to save considering he lived through his 20s with no health insurance or employer-sponsored retirement plan but drove a great car.
Step 2: Lower your investment costs
You should also consider cutting your investment costs in 2018 and beyond if you want to have higher returns. According to Green, most investment managers don’t make you any money at all although they get paid regardless. 75% of all active fund managers don’t outperform unmanaged benchmarks yearly. 95% of all active fund managers fail over 10 years or more.
Why would you want to pay your fund manager hefty fees when they have a very slim chance of making you any money at all? Furthermore, investment returns and fees/charges are inversely correlated which simply means your financial advisor makes more when you make less. This is true for investment fields like fixed income. For a 10-year treasury paying 2.4% currently, a 1% expense ratio translates to 42% of your total return. Such an investment cost doesn’t make sense at all when your goal is increasing your returns.
Step 3: Rebalance your portfolio
Lastly, you need to rebalance your portfolio. There’s no reason why you should be holding on to investments which appear to have reached a peak.
The stock market, for example, has been on a remarkable run since the 2007/2008 global economic crash. This simply means you may be holding more stocks in your portfolio currently than you would be comfortable with in the event of a quick downturn.
For this reason, you need to rebalance your portfolio which simply means; selling those asset classes which have appreciated in value the most and using the proceeds to buy asset classes which have lagged behind the most. Rebalancing reduces risk while increasing long-term returns.
Green usually advises traders to cut their losses and hang on to winning trades, however; there is a big difference between rebalancing an investment portfolio and trading individual securities. When investing, you will be glad you sold surging assets and bought lagging ones in the long run since the cycle always returns.
There you go! Follow the three simple steps above and increase your chances of enjoying higher returns in 2018. Saving more will ensure you have more money for investments and retirement planning. Lowering your investment costs will boost your returns while rebalancing your portfolio will reduce investment risk.
Nevertheless, there is more to prudent investing than what is discussed above.
For more investment and financial advice, visit www.oxfordclub.com
You can benefit from free investment and retirement planning advice by becoming an Oxford Club member. The Club has a special education arm known as Investment U that offers its subscribers free e-letters. Investment U also offers other educational resources such as videos, courses, and conferences that offer solutions to the most important financial subject i.e., attaining financial freedom. Investment U also has a paid version e-letter that offers actionable stock recommendations from renowned market experts.
For retirement planning advice, you can subscribe to the Wealthy Retirement, a special resource Oxford Club resource for retirement planning. The Wealthy Retirement offers articles covering a wide range of retirement-ideal investing subjects such as bond investing, dividend investing, market trends and income debates. Other resources offered include; free investment reports and financial calculators such as a dividend reinvestment calculator.
The Oxford Club has other investment resources such as the Energy and Resource digest, a free newsletter founded in 2015 that focuses solely on the energy sector. It is extremely difficult to identify profitable trends in the energy sector. The Oxford Club makes it extremely easy with this resource. The newsletter offers readers insider information on what is happening in the energy sector at any given time minus the rhetoric common in energy sector publications.
Enjoy other benefits of becoming an Oxford Club member i.e., going to annual Club gatherings all over the world and meeting the Club’s investment experts, networking on a global scale and enjoying unmatched financial freedom.