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Starting Your Investing Program
by Stanley Broughton
http://www.swsinvesting.com
If you are ready to start investing, you are probably
feeling overwhelmed at all the different options
available to you. Should you invest your money in a
high interest savings account, or perhaps a lucrative
technology stock? The choices seem endless, and
without the help of a trusted financial advisor, you may
end up investing in the wrong thing. If you are
investing for the first time, you may want to start off
with a low risk investment such as mutual funds. Keep
in mind that low risk usually means less chance of
getting a large return, but just remember that everyone
needs to start somewhere.
Before you make any investments, look closely at your
financial situation. Do you have any high interest debt
such as credit card? If you do, it makes sense to pay it
off before you start investing your money. Usually, you
return on investment won~t even come close to what you are
paying out in interest. Once you take care of your debt,
you can decide what you want to get out of your
investments.
It~s easy to start thinking about all the money you can
make, especially by investing in some hot new company. The
fact is you most likely won~t be tripling or even doubling
your money anytime soon. You risk losing all your
investment funds if you don~t use common sense and good
advice. Stocks increase in value, but they also come
crashing down.
Before you try the stock market you should be familiar with
how well you handle stress. The market isn~t stable and you
have to be ready for constant change. If you tend to panic
and fear you might sell a stock the minute it starts
slipping, then you probably aren~t a good candidate for
this type of investment. A stock can go down one day and
back up the next. You must be able to step away from the
situation and remain impartial while you let your money
ride. Make a small stock investment and see how well you do
emotionally.
Investment strategies depend on whether you plan to be in
it for the short or long term. Will you need the money
within the next five or ten years? If you answer yes, then
other options would be better for you than stocks, bonds,
or mutual funds. If you expect to make money from any of
these categories, you have to let your money stay invested.
If you think you~ll need access sooner, then high interest
savings accounts, certificates of deposit, or money market
accounts are more likely to meet your needs.
Investing is serious business and can make a lot of people
nervous. If you plan to try it, do plenty of research and
carefully consider the various options.
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