Investing for Beginners
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.
When you are ready to invest you should first
determine if you have any high interest debt such as
credit card debt. If you do, pay it off before you start
investing your money. The return you get from your
investment will probably not even come close to what
you are paying in interest. Once that is dealt with, you
should decide what you want to get out of your
investments.
You may be dreaming of the perfect investment in the
stocks of a new company where you can sit back and
watch your money double, triple, etc. Don~t count on
this happening. It is possible, but for your first
investments, you want to be smart. Don~t lose all your
money trying to live a pipe dream. As fast as stocks go
up they can come down.
Because of the volatile nature of the stock market, you
should ask yourself if you can deal the sometimes
stressful fluctuations. Many people will panic if a stock
goes down and sell as quickly as they can, only to see
the stock rise shortly thereafter and exceed the value it
was at before they sold it. You need to be able to
detach yourself from the situation and objectively
decide what makes sense. Start off with a small
investment in stocks to determine if you can deal with
the risk involved.
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.
Submit An Article
|
|
|
