Investing: Start with an End in Mind

Last Updated on October 14, 2021 by Rat Race Running

“If you are planning to start investing, what do you want to achieve?”

Many people invest because of several reasons, but here are two of the most common answers.

  1. To make my money grow; and
  2. To beat inflation.

Basically, there is nothing wrong with those. But in investing, your reason should be more than that.

The keyword is to “achieve.” What do you want to do with the money you will gain (?) after several years of investing?

(The (?) is placed to emphasize that there is no guarantee in investing. We can only rely on historical performance.)

Setting a Goal.

A goal is your dream with a deadline, and most often, with a price tag.

Setting a high goal should not scare you. What you should be afraid of is a wasted life wrapped in mediocrity.

Most of us dream of having a good life. Living in a beautiful house, driving a fancy car, giving children a good education, and traveling now and then.

But as many as those who dream, it is almost as many who fail.

So before you start placing your hard-earned cash into any investment vehicle, you should first know where you’re going to use it.

How to Set a Financial Goal?

Many of us are already familiar with the acronym SMART in goal-setting, which can also be used in investing.

But for those who forgot, they are:

S — Specific — state what your EXACT goal is. (house/car/retirement)

M — Measurable — how much do you need?

A — Achievable — what steps do you need to take to achieve your goal?

R — Relevant — is it in line with your other goals or current situation?

T — Time-bound — and most importantly, your investing goal should have a deadline. When do you wish to buy/achieve your financial goal?

Where to Invest?

Where to invest will significantly depend on your goal.

If you are retiring in 5years, it wouldn’t be wise to invest in the stock market because of its volatility.

You will not maximize your investment potential if you are 23y/o saving in a time deposit if it is to be used for retirement.

Your investment goal should be in line with your time horizon.

For the short term, less than one year, you should invest in low-risk, low-return products like bond funds, money market funds, and time deposits. This will preserve your investment capital.

For the medium term, 1year to 5years, the best investment vehicle is the balanced fund. Since it is a moderate risk, your capital will be invested in low-risk (bonds) and high risk (stocks).

For long-term investing, more than 5years. The best investment is in equity funds like the stock market. The time component will normalize the high risk. The longer the time you are invested, the safer the stock market gets. (I think I will write a new post for that.)


It is human nature to dream and dream big. But dreams will always be dreams unless we take action.

Place a deadline (and a price tag), and you have yourself a goal.

Investing is just a means to an end, just like money is a tool. Having more cash should never be your ultimate goal.

It should be used to enjoy and experience our God-given time.

There may be other circumstances not considered in this post, but I believe that if God put you in your current situation, He will push through. We have to let Him.

Happy investing, and God bless.

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