The following is a sponsored post from our friend Daniel Bailey. Dan is a content marketer. Who formerly workout of Digi Metrices and a banker. He is a writer by day and reader by night. His passion, energy is real and undeniable. That passion in this industry always drives him to the right to personal finance, investment, and saving money related topics.
What You Should Know Before You Invest
Investing is not a skill that comes naturally to most of us. It takes some experience and some know-how to carefully grow your hard-earned money. However, investing doesn’t require a wealth of knowledge or a college degree to get it right. There are some basics you should be aware of and understand before you invest to maximize your potential for success.
What Are Your Goals?
The answer here has to go a little deeper than just “make money.” Ask yourself questions until you narrow down your end goal. Are you saving for a down payment on a house? Are you trying to get out of debt? Are you focused on creating an income portfolio? Identifying the “why” is a powerful step in the investing process. It can provide the motivation you need when the path gets a little rocky. You can develop long and short-term goals as well. You might have a short-term goal to pay off a credit card and a long term goal to buy a house. Spend the time necessary to really identify your expected outcome.
Should I Pay Off Debt Before I invest?
If you are struggling to pay your bills, now is probably not the best time to invest. Paying your bills on time should come first. Once you have established the ability to meet your financial obligations and you have some extra money each month after doing so, that is the money you can use for investing. One thing to consider is the interest rate on your current debt. Anything 10% or higher is definitely something you will want to get paid off quickly. Using any reserves to pay down that debt will likely be your best bet. You can share your personal situation with a financial adviser for advice that is specific to your needs.
What Investments Should I Choose?
From mutual funds to stocks and bonds to real estate, there are countless options for investors to choose from. It can be difficult to answer this question by yourself unless you have experience in the finance industry. This is the step that may require enlisting the help of an asset manager like Fisher Investments or Fidelity or Charles Schwab, for example. Professional money managers are dedicated to assisting clients with their investing goals. If you followed step one, you’re ready to meet with an adviser to go over your goals and the best route to accomplish them. If you want to familiarize yourself with a bit more financial knowledge you can use videos about investing from Fisher Investments. This might help you feel a bit more confident going into your meeting with an asset manager.
Never Stop Learning
The financial world is an exciting ever-changing place that provides an endless opportunity for knowledge and growth. If you want to be involved with your investments, it makes sense to gain as much insight as possible. In addition to the videos we mentioned, read books, online resources and investment guides to keep up on what is current. Be patient with yourself as you learn and develop more financial confidence. Be realistic with yourself and your goals. For most of us, wealth doesn’t happen overnight. It will take years to create the nest egg you’re dreaming of so slow down, learn a lot and be forgiving as you tread this new path. It can be exciting to watch your financial reserves build. However, keep in mind that the market fluctuates on a daily basis. You and the rest of the financial world will have to weather the ups and downs that will come, so get comfortable with being uncomfortable.