The richest people in the world make their money in various ways; however, one of the primary things they all have in common is making smart investments. Now, you don’t have to have much money to invest, but you need to be willing to put some of your money to work for you. See a previous post on how much it can take to start investing. Read HERE. First-time investing tends to make people somewhat nervous, but that doesn’t have to be the case.
Relax and take your time to decide what type of investing you want to do. To do this, you must know exactly your financial goals. After all, if you don’t know where you want to end up, then you won’t have any idea of where to start. So don’t rush into investing just to make one, but rather as a means to reach a goal. You must develop and follow an investing plan to keep you on track and focused. You need to know and understand your goals; this previous post can assist you with this. Read HERE.
Once you have an idea of where you want to end up, first-time investing requires you to make an overall plan. This isn’t as hard as it sounds. You already know your starting point and have some idea of where you want to end up, and making a plan is simply filling in the gap between those two points.
Consider how much you have to invest right now and how much you will be able to contribute to your investments on an ongoing basis. The more you put in earlier, the better because of the power of compounding, and this will give your money more time to work for you. Consistently adding to your investment total is a good habit and will give you a much bigger payoff when all is said and done.
Another thing you have to consider before investing is how much time you have before you need to start collecting your investments. If you are only in your 20s, you have plenty of time (though you should get started as soon as possible) to allow your portfolio to mature. However, if you are in your 50s or older and approaching retirement, your investment strategy as a first-time investor will be much different.
Time is not the only thing you have to think about, though. It would be best if you also had an idea of how much risk you can tolerate. No matter what anybody tells you, all investments come with some risk. Of course, some are riskier than others, but those are also the ones that have the potential of a higher payout. Regardless, you need to have investments that you’re comfortable with and make sense for you and your situation.
There is no doubt that first-time investing can make people nervous. But there are professionals out there that can help you along the way, a Registered Financial Consultant (RFC) is an excellent example of someone who may help you. However, it would be best if you were well-prepared before you talk to them and work with the one you select as they will know all your financial details, and you need to be organized to make things go as smoothly as possible. Remember, it’s your money and your future, so it may as well be a prosperous one.
If you have questions about investing or are ready to start, you can go to an online brokerage account such as Schwab. If you live in or near the Metro-Nashville area, contact me directly. For those outside middle Tennessee, seek a qualified fee-only RFC near you to assist you and help you achieve your financial goals.
