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Goals-Based Investing

Also called: Outcome-based investing

What is goals-based investing?

Goals-based investing is an investing approach that uses both risk and reward to help investors meet their financial goals.

Goals-based investing involves identifying an investing goal, estimating how long it will take to accomplish that goal, and understanding your risk tolerance. Investors can then assess their current financial situation and identify how much money they need to reach their goal. They should also determine how much money they can regularly save to reach their goal. This will help them understand how much they need to save and the minimum rate of return they need to earn from their investments to accomplish their goals.