More often than not my client conversations begin with a series of questions regarding the many economic problems facing Australia and the world. Indeed there is no shortage of things to worry about in the current environment. There’s the known problems including the escalating confrontation in the Middle East (this one never seems to go away), the US Debt Ceiling, and the mountain of debt on the balance sheet of most major old World economies. And then there is the unknown problems, which often cause bigger problems than the known ones (we are all now thoroughly familiar with US Sub Prime).

Whilst these matters may indeed shape the future, the reality is that forecasting how they will play out is near on impossible.
There will always be many things for investors to worry about. However, it’s not productive to worry about the things you cannot control. Instead of worrying about them, you should focus your attention on the things you actually can control, such as:

• The amount of risk you take, making sure that you don’t take more risk than you have the ability, willingness and need to take.
• Diversifying the risks you take as much as possible, minimising or avoiding the risks that don’t give you higher returns.
• Keeping your investment costs low.
• Keeping tax efficiency high.

What many investors fail to understand is that factors such as the amount you spend, and the date of your retirement can have more impact on your financial plan than beating the market by using speculative “in and out” market timing strategies.

Not only is focusing on the things you can control far more productive, but it will also allow you to enjoy your life more, and that in and of itself is a worthy objective.