Recommendations to help you invest wisely
Follow these steps to improve your finances and make sure you are investment-ready.
07:47 15 December 2013
Investments are one of the best ways to get ahead financially, but figuring out the best way to invest can be difficult since everyone’s circumstances are unique. There are a few general recommendations that can be helpful for anyone wondering about investments.
- Debt—if you have debt beyond a mortgage payment, the best thing to do is pay off debt so you have more money to put into investments.
- Savings—make sure that you have easily accessible funds for any unexpected situations. If you have a sudden layoff, medical issue, or home repair, you want to ensure that you will not be dipping into your investments or going in debt in order to handle the situation.
- Maximize investment potential—investments work best when larger amounts of money are involved. Review your budget and expenses to identify changes that can be made to provide more cash flow for investments:
- Reduce living expenses when possible
- Increase income by developing a hobby, taking a promotion, or working additional hours.
- Set a spending amount for the month and stick to that pre-set amount.
- Maintain current payments on debts and utilities to keep credit ratings in good standing.
- Diversity—when planning investments, it is important to select complimentary investments so that when one of your investments loses money or does not earn as much, you still have another one, which will be more likely to remain stable or increase. This ensures your investment growth will remain relatively steady so you reach your ultimate savings goals.
- Consult—one of the best things you can do for successful investments is to consult a financial professional with plenty of experience to help guide you through creating your investment portfolio.
- Management—you can decide whether or not to have a fund manager help with your investments or not.