If you’re new to investing, it might all seem overwhelming. There are so many different types of investments in every market imaginable. Some people are more comfortable investing in mutual funds while others prefer to purchase individual stocks. It’s essential that you research all of your options carefully and then get started with a small initial investment. Your broker or consultant should be able to give you money investment tips based on your risk factor, current financial situation, and amount of money you will be able to afford to put into an account each month. Never, ever invest with money that you cannot afford to lose, even if market conditions and statistics seem to be in your favor.
Here are a few tips to help you get started:
• “Mock investing simulators” are available and free. It’s really recommended that you practice using one of these before investing any real money. Using this kind of tool will really help you give you an understanding of your risk factor level and how you can diversify your portfolio in a way that is most favorable to you. You can also learn from your mistakes when using fake money in a mock account so that you won’t make those same mistakes when investing real money.
More Money Investment Tips to Grow Your Wealth
• Don’t overlook the IRA option. Putting money into an IRA account can be very rewarding – especially if you pick the right account. There are essentially two options: Roth and Traditional. With the traditional option, the contributions are deductible on your taxes. On the other hand, Roth contributions are not deductible, but the withdrawals you make in retirement WILL be tax free.
• Consider how much of your portfolio should actually be in stocks. Due to the potential long-term fluctuations, it makes sense that younger investors could ultimately profit, as they literally have decades to wait for the conditions of those stocks to be very beneficial to them. Likewise, as people get older, they tend to reduce exposure to stocks in order to preserve their capital. However, these are not rules that are set in stone. Each individual is different.
• Learn about the red flags you should be watching out for. For instance, if there is a particular stock that keeps dropping and dropping over the past 3 – 5 years, you should probably stay away from it. Just look at the charts. Also, it’s pretty obvious that you’ll not want to purchase any stock from a company that is currently under any type of investigation.
The best money investment tips and advice can be found at The Motley Fool. There is a wide range of services, resources, and tools (including free ones) to help you every step of the way.