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Showing posts from October, 2002

What Should You Invest In?

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Stocks, bonds, bank accounts or IRAs? How do you choose?

With several types of investments to choose from and also thousands of sub-categories under them, finding the most suitable investment choice can be a daunting task.

First off, the main consideration in any long-term investing decision is the rate of return expected from it. At times though, investing in short-term investment can enhance your wealth even if the returns are not as high as you want them to be. You can select from among these common short-term savings vehicles:

Short-term savings vehicles

Bank savings account: The most resorted to savings medium availed of by people, which provides small returns but better than keeping your money at home where it could be stolen or spent easily.

Money market funds: These funds are a type of special mutual funds that are invested in exceptionally short-term bonds. Money market fund shares are always valued at $1 whereas most mutual funds can have uncontrolled prices. Although they pay h…

Learning How to Invest (Part 2)

Planning and setting objectives

Investing is a long-term process, like planning a long vacation. Ask yourself these questions before you embark on this endeavor:

• What is your destination? (What financial goals do you have?)
• How long is your vacation? (What is your time frame in investing?)
• What should you bring along? (What investments forms will you choose?)
• How much gas do you need to use? (How much will you invest to achieve your goals? How much can you invest a regular plan?)
• Do you have stopovers on the way? (What short-term financial expenses do you have?)
• How long is your vacation? (Will you have to retire using your investment?)
• If you run out of gas because you frequently stop to rest and drive through the night, you are bound to spoil your vacation. So it is if you do not save enough money, if you invest haphazardly or fail to invest at all.

Answer these questions judiciously and honestly. Muddling th…