Written by David Rosbotham DipPFS | Financial Planner 

For most high earners, the idea of “beating the market” dominates financial conversations. This single misconception causes unnecessary stress, anxiety, and ironically, distances them from their actual financial goals. Let’s reframe the narrative and focus on what really matters: building wealth that serves your unique life goals.

Why Beating the Market Isn’t the Goal

The wealthiest individuals don’t obsess over outperforming the S&P 500. Instead, they focus on one thing: defining their own financial game.

Your personal timeline, goals, and circumstances matter infinitely more than chasing returns. Want to retire at 45? Travel the world? Start a business? These dreams require custom strategies, not market comparisons.

The truth is, the market doesn’t care about your goals—but you should.

Ask Better Questions To Achieve Financial Independence

Stop asking, “What did the market do today?” Start asking questions that put your life at the centre of your strategy:

• What’s my financial freedom number?
• When do I need to reach it?
• What actions do I need to take this week, this month, and this year to get there?

When it comes to wealth building, there are only three numbers that truly matter:

1. Your savings rate
2. Your Net Worth or Target Income for Financial freedom (aka retirement)
3. Your timeline to freedom

Notice what’s missing? Market returns.

Avoiding Common Pitfalls: Why Personalised Wealth Strategies Matter

The most dangerous pitfall in investing isn’t market crashes—it’s comparing your returns to others. Your colleague’s 15% return means nothing if they’re playing a different financial game.

Case in point: Imagine someone two years from retirement comparing their portfolio strategy to a coworker who’s ten years younger. Or an expat planning to retire abroad taking cues from a Swiss citizen retiring in Switzerland.

These comparisons ignore critical factors like taxes, investment vehicles, time horizons, and personal circumstances.

Implementing Your Personalised Strategy for Financial Freedom

Checking your portfolio ten times a day won’t change your returns—but it will raise your stress levels. Try this instead:

• Focus on increasing your savings rate rather than chasing elusive market outperformance.
• Automate good financial habits instead of optimising for perfection.
• Remember: your behaviour influences your success more than any market fluctuation.

Think of wealth building as a road trip. The S&P 500 is someone else’s destination. You need your own map, your own timeline, and your own definition of “arrival.”

Case Study 1: The Importance of Tailored Financial Focus

A tendency to focus on outperforming the market instead of aligning investments with personal goals can be a very costly mistake.

Take Rebecca’s example:

• Rebecca earns 300,000 CHF annually, with a 25% bonus and a 25% long-term incentive (LTI) tied to her performance.
• She manages her own portfolio of 200,000 CHF, spending significant time and energy trying to “beat the market.”
• Over the past few years, Rebecca has achieved an impressive 7% annual return on her portfolio, compared to the Swiss market index return of 6%. She is very proud of her results but finds the time commitment and stress overwhelming and has little time to focus on other things.

Now consider an alternative strategy:

If Rebecca focused on hitting her KPIs consistently over the next 10 years, she could earn an additional 1,500,000 CHF through bonuses and LTIs (from her 25% bonus and 25% LTI on her 300,000 CHF salary × 10 years). In contrast, her extra 1% annual portfolio return only generates an additional 35,260 CHF over the same period (393,430 CHF vs. 358,170 CHF).

Even if Rebecca managed to achieve an 8% annual return instead of 6%, her portfolio would only grow to 431,785 CHF, still nowhere near the financial impact of her bonuses and LTIs.

Developing a Customised Financial Plan to Build Wealth on Your Terms

For professionals like Rebecca, chasing market returns often offers diminishing financial benefits compared to optimising career performance. The time and energy spent on trying to “beat the market” could be better invested in professional growth, hitting KPIs, and securing bonuses or long-term incentives.

Rebecca’s situation underscores a universal truth:
Your financial strategy should align with your personal goals, risk tolerance, and unique circumstances. Don’t let someone else’s benchmark dictate your financial decisions. 

Case Study 2: The Importance of Asset Allocation

One of the most expensive mistakes I see as a financial adviser is the wrong mix of stocks, bonds, cash, and alternative investments in client portfolios.

Asset allocation: the way you spread your money across different investments — determines both your returns and your risk exposure. To determine your ideal allocation, go through these three critical tests:

1. Ability to Take Risk

Four factors shape your ability:

• Investment Horizon: When will you need the money?
• Stability of Income: Is your job secure and predictable?
• Need for Liquidity: Do you need cash in the near term?
• Backup Plan: What’s your plan if returns disappoint?

For example:

• An aggressive investor may have a 30+ year horizon, a stable tenured job, a solid emergency fund, and flexibility to delay retirement.
• A conservative investor might plan to retire in 5 years, work in a cyclical industry, need cash access, and have no flexibility to delay retirement.

2. Willingness to Take Risk

This test measures your emotional tolerance. Ask yourself:

• Can I sleep at night with the current level of risk in my portfolio?

Emotional resilience is critical to sticking with your plan during market downturns.

3. Need to Take Risk

This test calculates the return you need to meet your goals. If your goals are already within reach, your need for risk decreases. At this point, your strategy should shift toward wealth preservation.

Stocks vs. Bonds: Striking the Right Balance

• Stocks: Drive portfolio growth.
• Bonds: Reduce volatility and protect your portfolio from major downturns.

You may increase your stock allocation if you:

• Have a long horizon, stable income, and low need for liquidity.
• Are comfortable with risk and can sleep soundly despite market volatility.
• Need higher returns to achieve your goals.

This is the most important part – Remember, almost all the risk in stocks is short-term.

Long-term investors benefit from compounding growth.

Tailored Financial Planning: The Key to Financial Success

The number one mistake I see? Investors nearing retirement comparing their returns or strategies to others with completely different circumstances.

Even more concerning: expats modelling their portfolios on local citizens without accounting for critical differences like tax structures, investment vehicles, and retirement goals.

Read more about why tailored financial planning is so important in our free e-guide:

Final Thoughts: Make Your Life the Benchmark

Stop tracking your portfolio against the S&P. Instead, measure your progress against your own life goals.

Remember, the S&P 500 is composed entirely of equities, making it a benchmark for a 10/10 risk profile. If your risk tolerance is a 5/10, comparing your portfolio to the S&P is not only irrelevant—it’s counterproductive. A balanced portfolio with a mix of stocks, bonds, and other assets will naturally have lower volatility and different return expectations.

Define your financial game. Build a strategy tailored to your timeline, needs, and dreams. And remember: the only benchmark that matters is the one that brings you closer to the life you want to live.

By shifting your focus to your own strategy, you’ll replace stress and anxiety with confidence and clarity. Start now—your future self will thank you.