Building a long-term investment portfolio can be complicated and often feels overwhelming. But working with someone you trust, following a defined set of steps and keeping your goals at the forefront of your mind can make the process more manageable.

Your first step is establishing your investment profile. This should include your financial goals and your time horizon, which is how far off you are from reaching those goals. For example, if you are saving for retirement, you may have 20 or 30 years to invest. On the other hand, if you are investing for your child’s college tuition, your time horizon may be shorter.

Next, you need to determine your risk tolerance and what type of return you are comfortable taking on your investments. The best way to do this is by talking with a professional and conducting a risk assessment questionnaire. Then you can establish your investment formula, which is the percentage of your assets that will be invested in each asset class, such as stocks and bonds.

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It’s important to diversify within each asset class, too. This will help to reduce your exposure to volatility. For example, if your investment formula primarily includes stocks, a small allocation to bonds can provide stability during market downturns. In addition, you may want to consider adding some alternative investments to your portfolio to pursue growth or diversify further. These could include commodities, precious metals and real estate, among others.

Finally, it’s important to periodically review and rebalance your portfolio, adjusting the percentage of each asset class so that it remains in line with your desired investment profile. This will help you avoid making emotional decisions based on short-term market fluctuations, which can be costly over the long term.