Hi, Welcome Back! I asked in my previous post to think about 2 questions. How much money should you invest in the stock market? Do you think you should invest all your savings? For the second question this is not necessarily true to invest all your savings? I think that would not be a smart investor. But how much should you invest? First, let's take a look at how much money you can currently afford to invest. Do you have savings that you can use? If so, great!
However, you don't want to cut yourself short when you tie your money up in an investment. What were your savings originally for?
It is absolutely important to keep three to six months of living expenses in a readily accessible saving account-don't invest that money! Don't invest any money that you may need to lay your hands on in a hurry in the future.
So, begin by determining how much of your savings should remain in your savings account, and how much can be used for investments. Unless you have funds from another source, such as an inheritance that you've recently received, this will probably be all that you currently have to invest.
Next, determine how much you can add to your investments in the future. If you are employed, you will continue to receive an income, and you can plan to use a portion of that income to build your investment portfolio over time. Definitely speak with a qualified financial planner to set up a budget and determine how much of your future income you will able to invest. (An up coming post we will discuss The Ultimate Financial Management-The Budget...stay tuned)
PS: Never borrow money to invest, and never use money that you have not set aside for investing! And with a help of qualified financial planner, you can be sure that you are not investing more than you should-or less than you should in order to reach your investment goals. Here are two websites to examine. FinancialPlannerNetwork! or
fpanet.org You can also search the internet using the keyword search "financial planner" using Google or Yahoo.
Happy investing......stay tuned for more.
Sunday, March 4, 2007
Tuesday, February 27, 2007
How Much Money Should You Invest?
Hi, Welcome Back. My time is limited today so in case you missed some of my previous post, here is a few you can catch up on in the mean time: Choosing a Broker that Right for You. How to Determine your Risk Tolerance. Determining Where You will Invest. Investing Basics-What Are Your Investment Goals. Getting Your Feet Wet-Begin Investing.
In my post today I want you to think about these questions. How much money should you invest in the stock market? Do you think you should invest all of your savings? Well, do you know that many first time investors think that they should invest all their savings, and this isn't necessarily true. To determine how much money you should invest, you must first determine how much you actually can afford to invest, and what your financial goals are. (You would see financial goals mention a lot because its important). Like I mention at the begin of this post my time is limited, so stay tune for more.....
Happy Investing
In my post today I want you to think about these questions. How much money should you invest in the stock market? Do you think you should invest all of your savings? Well, do you know that many first time investors think that they should invest all their savings, and this isn't necessarily true. To determine how much money you should invest, you must first determine how much you actually can afford to invest, and what your financial goals are. (You would see financial goals mention a lot because its important). Like I mention at the begin of this post my time is limited, so stay tune for more.....
Happy Investing
Monday, February 26, 2007
Getting Your Feet Wet-Begin Investing
Okay, now that you have read my previous articles, you think you are ready to begin investing without having a lot of knowledge about the stock market. Here is some basic things you can begin with, and you can start by being a conservative investor with a low risk tolerance. This will give you a way to making your money grow while you learn more about investing.
Start with an interest bearing saving account. You may already have one. If you don't you should. A savings account can be opened at the same bank that you do your checking at-or at any other bank. A savings account should pay 2-4% on the money that you have save in the account. It's not a lot of money-unless you have a million dollars in that account-but it is a start, and it is money making money.
Next, invest in Money Market Funds. This can often be done through your bank. These funds have higher interest payouts than typical saving accounts, but they work much the same way. These are short term investments, so your money won't be tied up for a long period of time-but again, it is money making money.
Certificates of Deposit are also sound investments with no risk. The interest rates CD's are typically higher than those of savings accounts or Money Market Funds.
You can select the duration of your investment, and interest is paid regularly until the CD reaches maturity. CD's can be purchased at your bank, and your bank will insure them against loss. When the CD reaches maturity, you receive your original investment, plus the interest that the CD has earned.
If you are just starting out, one or all of these three types of investments is the best starting point. Again, this will allow your money to start making money for you while you learn about investing in other places.
Remember my blog was created for new investor(basic information) not for the advance investors, but I certainly welcome any comments & suggestions.
Happy investing....stay tuned for more
Start with an interest bearing saving account. You may already have one. If you don't you should. A savings account can be opened at the same bank that you do your checking at-or at any other bank. A savings account should pay 2-4% on the money that you have save in the account. It's not a lot of money-unless you have a million dollars in that account-but it is a start, and it is money making money.
Next, invest in Money Market Funds. This can often be done through your bank. These funds have higher interest payouts than typical saving accounts, but they work much the same way. These are short term investments, so your money won't be tied up for a long period of time-but again, it is money making money.
Certificates of Deposit are also sound investments with no risk. The interest rates CD's are typically higher than those of savings accounts or Money Market Funds.
You can select the duration of your investment, and interest is paid regularly until the CD reaches maturity. CD's can be purchased at your bank, and your bank will insure them against loss. When the CD reaches maturity, you receive your original investment, plus the interest that the CD has earned.
If you are just starting out, one or all of these three types of investments is the best starting point. Again, this will allow your money to start making money for you while you learn about investing in other places.
Remember my blog was created for new investor(basic information) not for the advance investors, but I certainly welcome any comments & suggestions.
Happy investing....stay tuned for more
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