Young people are bombarded with advertisements from banks and investment firms urging them to start investing early and reaping the benefits of compounded growth, but even then, leaving the money in ordinary savings accounts isn't enough.

With low interest rates affecting returns of bonds and other fixed-rate investments, advisers say Canadians need a diversified portfolio. The consequences of leaving a large portion or all your money in a low-return account over a long period can be dramatic.

For example: a $2,500 initial investment at a one per cent annual rate of return for 30 years will turn into $3,369.62. But the same investment with a six per cent rate of return would become $14,358.73.

Advisers say investors need to establish a financial plan based on their goals — whether that is retirement, buying a home or planning for children — and their level of risk tolerance.

Investors should review their holdings with an adviser at least once a year to make sure their investment mix fits their goals. It's not rocket science; it doesn't have to be a long process. The time that you've committed to park the money—it doesn't take a whole lot more time to properly invest it. If that's what stopping you, the time, it really doesn't have to.

Laying out a strong financial plan and then sticking to it is far more important than trying to pick the next hot stock sector. If the money isn't properly invested, inflation could easily eat up the value of savings.

With an RRSP, taxes are not an issue, but inflation is. And if inflation is, say, two to three per cent, if you take the average savings-type vehicle you're maybe breaking even and, maybe in some cases, going backward.

There are three common factors among those that have been successful investing in stocks or other holdings. They're focused, they're consistent with their approach and they're disciplined. They have a goal, they stick to it and they're not going to get distracted.