Basics Beginner: Investment Goals

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1.
Which of the following is not a reason to invest for growth?
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To pay off current debts. Growth investing usually uses a long-term horizon, whereas paying off debts is usually done as soon as possible.
2.
A recent retiree is likely to have an investment goal of current income.
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True. Retirees often seek additional income to supplement their pension and Social Security income.
3.
Investment advisors suggest increasing the number of fixed-income securities in your portfolio as you age because _______.
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Advanced age makes it difficult to regain losses from more volatile investments such as stocks. Having fixed-income securities in your portfolio can reduce this problem.
4.
The rate at which prices increase over time is called inflation.
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True. Inflation is the process of rising prices.
5.
Time horizon is the amount of time you have to achieve your investment goal.
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True. It can be short-term or, in the case of retirement planning, decades long.
6.
The plan you set with a financial advisor will be regularly reviewed.
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True. The plan will be reviewed to determine how well you are progressing toward meeting your goals and to determine whether they should be changed.