Long Term Results Are What Counts When Investing

by Dominique Schuh

The market has finished its fourth day of positive gains, taking the All Ords towards the highest mark for 2016. However, traders are waiting for key economic data from the US to be released later in the week, which will help determine whether US rates will be hiked.

Analysis on our standard of living and wage growth shows that national average full-time salaries for jobs grew just 0.6 percent in the last financial year. This is while real living standards - calculated as income adjusted for inflation and population growth - have been on a downward slope since June 2012 when the mining boom reached its peak. This means that wages are not going up fast enough to keep pace with the cost of living.

What does this mean for you?
Investors can enjoy some better news from the share market at the moment, but don't slip into complacency. Remember that markets can easily move up or down at the drop of a hat, and it's the long term results that are important. Try to avoid "taking profits" when markets move up, as the chance of making the correct decision in the short term is really just attributed to luck. Long term results are what count. 
If you've noticed you're peddling hard with your finances and getting nowhere, it may have something to do with our slow national wage growth. If this is the case, take a stand with your finances and commit to getting back to basics. Start with a budget and work out what you've got available to spend, save, reduce debt and invest. Even small savings add up over time.