As an investor, you’ve grown accustomed to hearing about the different indices with which to compare your portfolio’s performance. You hear and read about the Dow Jones Industrial Average, S&P 500, NASDAQ, interest rates and on and on. It’s easy to become confused as to how your portfolio is performing, how you should be performing, and whether or not you’re behind or ahead of where you should be. Worst of all, this leads to indecision, especially when you add in the talking heads and market “experts” that are broadcasting 24/7 on television, radio, Twitter and Facebook.
Consequently, I’ve found that the average investor can easily become paralyzed at the thought of not only keeping up with, but outperforming these benchmarks. This can lead to frustration and to moving from strategy to strategy or advisor to advisor looking for one magic solution to beat the indices. Worst of all, these aren’t your benchmarks, and have no relevancy in helping you achieve your financial goals.
Let’s propose that we put an end to this dysfunctional approach and replace it with an approach that matters to you. I call this approach your Personal Benchmark™. This benchmark, set by you, only applies to you and your financial goals. It becomes a yardstick by which progress is measured over time. Progress toward retiring with the lifestyle you want, paying for that new kitchen remodel, sending your kids through college, or buying that vacation home in the mountains. You deserve a Personal Benchmark™ so you can accurately track whether or not you’re making meaningful progress.
I have a client who asked if this means that he might be settling for a return, instead of expecting to beat the market. I told him that if settling means realistically working towards achieving all of his financial objectives, then YES. Some of our clients who go through our process discover that they need to either temper their goals or save more money. Either way, our objective is to make it personal and realistic.
We want something we can track every year, and make corrections to along the way. I believe that the reason clients come to us is because we can develop the strategy, tactics and tools to put them on the track towards getting to their financial destinations. We measure success by achieving your goals – and those start with achieving your benchmark.