I find that the majority of people focus solely on their investment returns. They compare their returns to those of their friends, family members, co-workers, and neighbours. If someone else’s investments performed better, they immediately believe that their investment strategy is a failure. I am here to tell you that this is not the case. Your financial success is determined by your goals. Let me re-state that.

Your financial success is determined by your goals.

Different Goals

Everyone has different goals, which means different measurements of success, risk factors, and time frames. Everyone has a different purpose for making the decisions they make. Your purpose is the straightest line to achieving your financial goals. Having a clearly defined purpose with corresponding goals and a financial plan means that you are making the right decisions for yourself. The investment strategies of your friends, family members, co-workers, and neighbours should align with their goals, not yours. If you begin to match your investment strategy to their goals, you could end up miles away from where you wanted to be.

Alignment

In any given year, your investments might not be the ‘top performer’ and there is nothing wrong with that. Aligning your investments to your goals will give you a specific risk tolerance. Your risk tolerance could vary across your investment accounts. It may very well be different from your spouse or partner’s risk tolerance. If you are a low-risk investor, your strategy could include higher monthly deposits and a lower investment return. This is a stark contrast to someone else who has a higher risk tolerance, where their strategy could have a lower monthly deposit and a higher investment return. Even if these two individuals are trying to achieve the exact same goal, it does not mean that one is more successful because their investment return was higher. They are both just as successful, as long as their investment strategy aligns with their goals, and they are achieving them.

Conclusion

If your investment strategy aligns with your goals today, it is the right choice. Your investment strategy, insurance strategy, and tax strategy should all align to achieve your financial goals. Therefore, regardless of whether your investment returned 32% or 3.2%, it should not matter. If your investment strategy is on the straightest line to achievement. Stop comparing yourself to others or thinking you are investing wrong because you did not get their results. You are doing what is right for you based on your financial goals.