Developing a flawless financial plan is easier than you think, and you don't need a lot of money to get started. The hardest part is keeping an eye on your big picture.

Whether you're socking away a home down payment, planning for retirement or saving for a child's education, how you proceed depends on what you want to achieve, said Christopher Davis, a fund analyst with Morningstar Inc. in Chicago.

The amount of time you have has the most impact on what investments you should buy; the sooner your goal, the less risk you should take. For most people, building up a retirement nest egg remains the biggest challenge.

Here's how the most successful investors keep their eyes on the prize.

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NAME THAT GOAL

"When friends ask, 'What should I invest in now?' I have a frustrating response," said Davis. "I say, 'What are you investing for? What do you want to accomplish?' The first thing you need to do is define your goal."

Most of us have long, complicated financial to-do lists that include hacking away at various debts and saving for all kinds of stuff. It can be challenging to tackle multiple goals at once, but multitasking is absolutely essential in investing. The most important item probably isn't your most immediate need.

Retirement may seem a long way off, but the sooner you start the less painful saving for it will be, Davis said. Getting a jump on your retirement account while you're in your 20s can mean the difference between setting aside $100 or $200 a month now versus $400 or $500 a month later to reach the same goal.

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MAKE A PLAN

When you know your goals, it's easier to figure out how to reach them. Lots of people in the financial services industry are paid well to convince you otherwise, but the simplest solution is usually best.

When you're saving for your golden years, target-date retirement funds are a great easy answer, said Davis. These ready-made portfolios, available from most of the no-load fund shops and through many 401(k) programs, are built for investors who would rather do something other than worry about their money. The fund's name includes the retirement year, and automatically adjusts to a more conservative mix of stocks, bonds and cash as the date approaches.

If you don't have access to an employer-sponsored 401(k) or you've already maxed out your contributions and want to augment your savings with a Roth or traditional IRA, you can open up an account directly through a fund provider. Some may require an initial investment of $2,500, but others, including T. Rowe Price, will let you to start with no money down as long as you invest on a regular basis.

"Once you start investing in a disciplined way, it becomes almost a mindless habit. It is taken out of your account and you view it almost like taxes or your medical plan," Davis said. "But unlike health care or taxes, you're paying yourself, and decades down the road you'll get much more back than what you put in."

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OWN EVERYTHING

A good target retirement fund will give you instant diversification with one-stop-shopping. But the definition of "diversification" can differ widely on Wall Street. If you're not happy with the options or just prefer having more control, a broadly diversified fund of funds makes a great first investment and can serve as a good anchor for your portfolio down the line.

To weather the market's ups and downs, you need to own a little bit of everything: stocks from companies of all sizes, both domestic and foreign. You'll also want exposure to both "growth" and "value" stocks; these words often appear in fund names, and refer to investing styles. Value investors look for solid, mature companies whose stock is underpriced. Growth investors are looking for smart, young upstarts with a lot of room to grow, whose share prices are likely to rise.

Owning a little bit of everything will give your portfolio stability, no matter what the market is doing.

"If you have a portfolio with exposure to large and small companies, growth and value stocks, it's sort of like you have an all-terrain vehicle," Davis said.

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SEE THE WHOLE PICTURE

When evaluating the options in your employer-sponsored 401(k) plan, keep an open mind. This is not a school lunch; if you don't like what they're serving, you can eat elsewhere. You may find your plan has great large-cap domestic options, but little in the way of smaller company stock funds or foreign stocks.

If this is the case, invest in the funds you like and fill in the gaps with an IRA. The main thing is to take a holistic approach to your retirement plan.

One mistake many investors make when they have a company-sponsored plan and an IRA is they duplicate their efforts, Davis said. If you are saving for retirement in more than one place, your holdings should complement each other.

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NEVER PAY TOO MUCH

Investing is an area where paying more doesn't get you more. You could spend a lot of money hiring advisers and paying extra fees for actively managed funds, but there's no guarantee you'll get a better return. In fact, if a mutual fund has high costs, it tends to underperform over the long haul, Davis said.

A low-cost total stock market index fund makes a great core holding. The cheapest ones are offered by no-load fund shops like Fidelity and Vanguard.

"Focus on the things you can control, and hope for the best in other respects," Davis said. "If you have a well-diversified portfolio and low-cost funds, your odds of success are high, better than they are for most people. As long as the stock market does reasonably well, you'll be fine."

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asap columnist Meg Richards is an AP business writer based in Washington, D.C.