Begin with obligations
Future expenses, emergency reserves and known withdrawals should be considered before allocating capital to long-term investments.
Separate growth capital and stability capital
Growth assets may support long-term purchasing power, while more stable assets may support liquidity and reduce the need to sell during adverse markets.
Set ranges, not a single perfect number
Target ranges allow a portfolio to move with markets while preserving discipline. They can also provide clear rebalancing triggers.
Review concentration honestly
Employment income, company shares, property and portfolio holdings may all be exposed to the same economy or industry. Household diversification should consider the full financial picture.
Rebalance according to policy
Rebalancing can be scheduled or triggered when allocations exceed predefined bands. The objective is to restore the agreed structure, not to predict the next winner.