However little money you have retained for investing, there are clear dos and don’ts to think of while doing it. You do not want to be over- enthusiastic nor over - cautious and you should make sure you aim at a reputable firm with a good track record. American Capital Ventures, founded by Howard Gostfrand, is an investment firm with enormous international and national network of brokers.
Before investing money, first of all make sure that you have waged off all your debts. The interest that you earn from investing will not make any difference in that your debt also has an interest. And no doubt the debt’s interest rate would be superior than your investment’s - so advantageously you will not make any profit. You should invest only that cash which does not have to be diverted anywhere.
You must hold aside the batch needed for the central living expense of three to six months. This is done to take care of any unforeseen emergency that could happen, like losing one’s job. This amount should be kept somewhere easily convenient, and cannot help but not be elevated by the fluctuations of the market. If you have not done this so far, begin from today. You can split your savings into half, and include one half as the emergency fund and the other for investing.
Masses have different goals for investing. Some do it to pay the down payment for a house, several for the children’s college fund, and few for retirement. Whatever the cause is, above investing you should ask yourself how much money you have now, and how much do you want it to grow into in a stipulated period of time.
Sometimes you might have a big amount of money to invest - perhaps inherited, or by trading off a property. It is better to diversify in such cases. You can also divide the cash among more than one firm. You have the options of investing in stocks, mutual funds, bonds, real estate, and precious metals. With these ,the ones that have highest liquidity is the last one - gold and silver. They are not subject to tax and keep above inflation too.
While investing, the first point to keep in mind is to acquire when prices are very low. In real estate, prices fall when the common demand for houses is less. This is the most fitting time to buy, for people would be desperately looking for someone to buy, and there will not be enough buyers. This is not the scenerio for stocks. The price of a company’s stock falls may be because there is something wrong with it. When there is a common crash of the stock market, it is not the company’s fault. The most desirable time to invest in stocks is when the prices have come down a tiny, and then sell them when they climb again. This way you may not make a killing, but you are very much assured that you will not suffer a loss either. The motto should be catch them on the way down, sell them on the way up.
Scott Hernandez has been working in the finance & investment domain for past 3 years as a relationship manager who believes in the works of Howard Gostfrand
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