Valley First

Avoiding Common Investing Mistakes

Avoid common investing mistakes and build your nest egg
November 24, 2014

Penticton, B.C.—November is Financial Literacy Month in Canada and it comes at a time when Canadians’ saving habits are in the spotlight again—and not in a good way.

A new study reveals that Canadians aren’t feeling so confident about their retirement.

According to Retirement Perspective and Plans, a study by the Conference Board of Canada, says 60 per cent of Canadians feel they do not have enough saved for retirement and 40 per cent don’t even know how much they will need to save for retirement.

The numbers reveal Canadian’s lack of money know-how. Five-in-10 Canadians surveyed said their financial literacy was “average” while almost 18 per cent said their knowledge was “below average.” That works out to more than two-thirds of Canadians lacking the knowledge to make solid personal finance decisions. Investment expert Mark Aynsley isn’t surprised by the findings.

“There’s a broad spectrum of financial understanding and knowledge in the people I help on a daily basis,” says Aynsley an investment advisor with Valley First. “Even those who consider themselves quite savvy still recognize they need help with their investments.”

Experts agree that common investment mistakes include making emotional investing decisions, focusing on the short-term objectives, under-diversifying your investment mix, and not aligning your investments with your risk tolerance and time horizon. But none of these missteps are as critical as the lack of an investment plan.

“The plan is critical because all your investing decisions are based on it,” says Aynsley. “But a plan without goals isn’t worth the paper it’s written on. Too often I see people investing just because they think they should be doing it—they haven’t really thought about what they’re attempting to accomplish or realized that investing is a means to an end.”

An important part of the advisor’s job is to help build their client’s investing and financial knowledge, not just carry out investment transactions.

“I want my clients to understand what I’m helping them achieve, the actions we’re taking and how it affects their investment objectives,” he says. “Getting clients actively involved in their investment plans naturally increases their financial literacy.”

About Valley First

Valley First is a division of First West Credit Union, B.C.'s third-largest credit union, which has 38 branches and 29 insurance offices throughout the Lower Mainland, Fraser Valley, Kitimat and Okanagan, Similkameen and Thompson valleys. Led by Launi Skinner, First West has $7.1 billion in assets under administration, more than 180,000 members and close to 1,300 employees.

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