Saturday, September 12, 2015

Smart Reasons to Start Investing


Investing your money is a great way to plan for your future including retirement, college education for your children of other investment opportunities such as starting a business. Investing allows your money to grow over time using compound interest. Well managed investment plans allow you to live the life you want and deserve. Investing allows your money to grow tax deferred. Investing outperforms inflation and will provide you with steady income when you retire. 

Many people ask for advice from friends, co-workers, family members, strangers and their financial planners about what they should do with their investments or retirement plan. Every investor has different financial goals and objectives and should work with a financial planner to develop a plan to assist with meeting those goals.  

Financial planners have expertise in how to survive the ups and downs of the stock market and can provide the best advice and if and when you should move your money. Here are some reasons why you should invest your money and smart ways to start investing.

Why Invest
  1. Reduces stress, anxiety, fear, depression related to your financial future. 
  2. Prevents you from having to work your entire life.
  3. Provides you with more options and more choices for your future and allows you to buy the things you want and need.
  4. Allows you to develop a solid financial plan so you can focus on other things such as spending time with family and friends and maintaining good health.
  5. Helps secure your future and earn income outside of your job.
  6. Generates income and has the fastest and most potential for long-term growth.
  7. Helps you achieve financial goals such as planning for retirement.
  8. Helps you manage your money.
  9. The more you save the more you earn – compound interest.
  10. Creates generational wealth.
  11. The future is not promised, you must prepare for the unexpected.

When to invest
  1. As soon as you start working as an adult or earlier. If your company does not offer a retirement plan, open your own IRA. You will need at least 30 years of investing (depending on your salary) to have enough money for retirement.
  2. If you plan on getting married.
  3. If you plan to have children.

How to prepare for investing
  1. Pay down debt.
  2. Create an emergency fund 9-12 months.
  3. Get adequate insurance life, health, disability and long-term care insurance.
  4. Consult a financial advisor to help you set financial goals, set a retirement date, decide where you want to live and the lifestyle you want to have.
  5. Plan for your estate (will, trust, advanced directive).
  6. Become a homeowner.

Where should you invest your money?
  1. Diversify
  2. Mutual funds
  3. Individual stocks
  4. Bonds
  6. DRIPS (Dividend reinvestment plan)
  7. Options
  8. Futures

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