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www.insideHALTON.com | OAKVILLE BEAVER | Thursday, October 23, 2014 | 22 T Get a personal rate of return yearly Dollars & Sense Peter Watson Guest Contributor he simple question investors have about their investments is how did they do? Investors want to know how much they invested, what it is worth now and what was the return on their investments. Knowing the rate of return is critical for ensuring you're on track to meet your nancial objectives. Without a performance number, you cannot monitor the progress towards that objective. Consider the return on investment number as the speedometer in your car. If your trip calls for a speed of 100 kilometers per hour and you drive slower, you will not reach your destination at the estimated time. Financial objectives should have a speci c target. You want to have a certain amount of money available for those payments when a child is ready for their post-secondary education. The same logic is true for retiring. By the time you retire, you want to have a certain amount of cash available to support your desired lifestyle. That amount will be a combination of what you saved and the return on investment earned. If your target return is six per cent and the return on your investment is under six per cent, you will fall short of what you had hoped to accumulate. Therefore, understanding the performance return on investments is critical. Don't just review how the mutual funds you are invested in performed during the year -- request a personalized rate of return from your adviser every year. This data may not be the same as the mutual funds' overall yearly performance. Published rates of return are for the entire year. They are not meaningful to you unless you were invested for the full year with no new contributions or withdrawals. It is your speci c return on investment based on when you invested or withdrew funds that will allow you to accumulate the correct value; not just industry averages. Once you have the individual return figure, determine if you're on track to meeting your objective. If you are slightly below your target return then you know you will accumulate slightly less than expected. You can accept this or increase the amount you save to make up the shortfall. If you are signi cantly below your target return, then it's better to adjust your actions to new realities to become more successful. Learn from what has happened and go forward with a new strategy. Making adjustments as you go is better when you still have time to recover. Understanding your personal rate of return on your investments allows you to monitor your success and adjust along the way if your investment performance is below target. -- Submitted by Peter Watson, MBA, CFP , R.F .P ., CIM, FCSI., Certi ed Financial Planner Chris, Electrical graduate Skilled Trades Open House THURSDAY, NOVEMBER | 5:30 8:00PM PM TUESDAY, NOVEMBER 47 | 5:30 ­­ 8:00 Drop by Drop by to to tour tour over over 17,000 17,000 sq. sq. feet of of construction, construction, electrical electricaland and feet machine shops machine shops and and learn learn about about The Centre's The Centre's pre-apprenticeship pre-apprenticeship programs. Meet programs. Meet the theinstructors, instructors, speak to to students students and and find explore speak out if your career options. a Trades career is for you. For more information, call or visit 189 | wannatrade.ca 905.333.3499 x121 860 Harrington Court Burlington, ON L7N 3N4 QE W al W Ha r s ve te rR d. The Centre for Skills Development & Training @wanna_trade The Centre's Channel Fa ir vie w St . t. S Se ic rv e Rd . H ar rin gt on C ke rs ne Li