We’re now in the last month of the year. Although we’ll have plenty of time to look back on 2021 in the coming weeks, I want to focus on 2022 as well. My key aim is how I can get ahead with stock investing. Whether I’m new to investing or if I’ve been active in the market for many years, having a good plan for the New Year is important. So here are several ways I’m trying to get a head start on next year.
Good planning
Cash flow planning sounds like a complicated term. In reality, it refers to managing my money so that I have cash available to fund needed expenses and investment opportunities as they come around. One way I can get ahead for next year is sitting down now and looking ahead at what I expect to make and when I expect to receive it.
After all, there’s no point having a stock that I want to buy early next year only to realise that I won’t have any free cash until the spring. So good cash flow planning now can allow me to have some spare funds during (ideally) each month next year to take advantage of any stock investing opportunities.
Following on from this, it’s equally important to know what I want to achieve with my investing. It’s a bit pointless having the free cash to put to work if I don’t know what I’m trying to do with it. Am I looking to try and build a retirement pot? Do I need to invest in dividend stocks to supplement my other income? If I can plan ahead and understand what my aim is for 2022, it can help to clarify where I need to be investing.
Stock investing via key themes
Even though we go into January, the relevant themes and what’s hot in the market right now in December will stay the same. So I can get a head start on next year by understanding what’s going to be in focus in early 2022.
For example, the Bank of England meeting is on December 16. This is important, as the committee will decide whether to raise interest rates or not. After the recent appearance of the new Covid variant, this could make the bank pause and not raise rates. The decision will impact the share price of many stocks within the FTSE 100 index.
And regardless of the action in December, the impact of any decision will spill over into next year.
A fourth way to get a head start is to think beyond the next few months and consider what the big issues will be later in 2022. This could be environmental, political or something else. But if I have conviction that something is likely to be big next year, I can consider buying shares in key companies now. That way, I can hopefully jump in before the rest of the crowd.
Overall, there should be a lot of twists and turns in 2022, especially with stock investing. So thinking ahead now should allow me to have the best shot at making it a successful year.
Jon Smith and The Motley Fool UK have no position in any share mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
This post was originally published on Motley Fool
