Saturday, November 24, 2007

Three Great Tips For Successful Investing

With the DOW hovering around 13,000 from the mortgage crisis fallout, I felt compelled to give you some investment advice: know yourself; determine your time horizon; and start now.

Know yourself: I’ve had people ask me: What is the best investment? Easiest answer: It depends. The first step to successful investing (notice I’m making a distinction between investing and trading) is knowing yourself. What is you tolerance for risk? During rough times will you continue investing or jump out a third story window? Determining your tolerance for risk sets the stage for all your investments and will help give you a proper mix of investments (stocks, REITs, bonds, etc). I have a high tolerance for risk, which is one of the reasons why I dabble in individual stocks. Hopefully they will boost my return.

Determine your time horizon: Most of my investment advice spans 20+ years, with some exceptions for individual stock trading. If you need a large sum of money in three years or less, then you probably don’t want to buy stocks. Saving money for a down payment on a house, a car, etc means your better off keeping cash in a money market account or short term CD so you’ll have a guaranteed lump sum when you need it. I’d hate to see anyone lose a huge percentage of an investment simply because they failed to realize their time horizon.

Start now: The time value of money is a beautiful thing. According to MarksJarvis, “In order to accumulate $1 million at retirement, you'll need to invest just $20 a week in a simple stock-market mutual fund when you're 19, about a $100 a week if you wait until you're 35, and roughly $300 a week if you delay until age 45, assuming a retirement age of 65 and an average annual return of 10%. (Though 10% is in the ballpark of how the market performed historically over many decades, there's no guarantee that it will continue to do so.)” I’m going to make a distinction here: don’t invest in a simple stock-market mutual fund—use a long term index fund like the Fidelity Total Market Fund, etc. 10% long term may be a stretch—I’d say 8% is more likely. If you want to do better, I’d have 20-30% of your portfolio in foreign investments—possibly more if you have a higher tolerance for risk.


MyAtm said...

I find this article very impressive.I do love your advice "start now".I was thinking that it's like a race,if you want to win drive smooth and steady don't rush.Love this post a lot.Thank you!

Coach Factory said...

celine handbags, reebok outlet, north face jackets, yoga pants, juicy couture outlet, marc jacobs, ghd, converse shoes, vans, hollister, soccer shoes, montre pas cher, wedding dresses, nike air max, valentino shoes, north face outlet, hermes, chi flat iron, louis vuitton, nike free, michael kors, timberland, p90x, soccer jerseys, beats by dre, louis vuitton, nfl jerseys, birkin bag, abercrombie and fitch, new balance shoes, mont blanc, oakley pas cher, ray ban pas cher, bottega veneta, supra shoes, lululemon, hollister, air max, insanity, ferragamo shoes, asics, lancel, mcm handbags, karen millen, herve leger, ralph lauren, mulberry, rolex watches, hogan, burberry

Coach Factory said...

canada goose, ugg boots, oakley sunglasses outlet, moncler, oakley outlet, cheap sunglasses, oakley sunglasses cheap, jimmy choo, cheap sunglasses, oakley vault, cheap sunglasses, oakley sunglasses outlet, ugg, canada goose, cheap oakley sunglasses, oakley sunglasses cheap, ugg boots, oakley vault, ray-ban, canada goose outlet, ugg boots, ray bans, ray ban sunglasses outlet, cheap oakley sunglasses, canada goose, oakley outlet, gucci, tn pas cher, moncler, oakley, louboutin, ray ban, moncler, canada goose, moncler outlet, discount oakley sunglasses, oakley outlet, cheap oakley, ray ban outlet, ray ban, oakley vault, canada goose outlet, cheap oakley sunglasses, oakley sunglasses cheap, raybans, ray ban outlet, oakley sunglasses outlet, ralph lauren, rayban

Coach Factory said...

prada handbags, kate spade outlet, prada outlet, ray ban sunglasses, ray ban, ralph lauren, jordan shoes, coach purses, louis vuitton handbags, louboutin, michael kors handbags clearance, michael kors outlet online, true religion, nike free, longchamp outlet, michael kors, polo ralph lauren outlet, tory burch outlet, oakley sunglasses, coach factory, oakley sunglasses, oakley sunglasses, nike shoes, gucci outlet, michael kors outlet, air jordan, air max, louboutin, ray ban sunglasses, louis vuitton outlet online, chanel handbags, louis vuitton, burberry outlet online, michael kors, nike free, cheap michael kors, air max, coach outlet store, longchamp, coach outlet, nike air max, polo ralph lauren outlet, true religion jeans, nike air max, tiffany and co, nike roshe run, toms shoes, true religion outlet, michael kors outlet online

Eric Yao said...

Ralph Lauren Outlet
Ugg Boots Sale UGGS For Women Skechers Go Walk Adidas Yeezy Boost Adidas Yeezy Adidas NMD Coach Outlet North Face Outlet Ralph Lauren Outlet Puma SneakersPolo Outlet
Under Armour Outlet Under Armour Hoodies Herve Leger MCM Belt Nike Air Max Louboutin Heels Jordan Retro 11 Converse Outlet Nike Roshe Run UGGS Outlet North Face Outlet
Adidas Originals Ray Ban Lebron James Shoes Sac Longchamp Air Max Pas Cher Chaussures Louboutin Keds Shoes Asics Shoes Coach Outlet Salomon Shoes True Religion Outlet
New Balance Outlet Skechers Outlet Nike Outlet Adidas Outlet Red Bottom Shoes New Jordans Air Max 90 Coach Factory Outlet

Unknown said...

san diego chargers jerseys
yeezy boost 350
nike store uk
dolphins jerseys
bengals jersey
michael kors handbags
jacksonville jaguars jersey
golden state warriors jerseys
cleveland cavaliers

chenmeinv0 said...

adidas stan smith
ray ban eyeglasses
hermes uk
polo ralph lauren
polo ralph lauren
prada handbags
ray ban sunglasses
adidas yeezy
coach factory outlet
coach outlet online

GIL BERT said...

ralph lauren
nike air huarache
ugg outlet
mont blanc pens
kobe 9 elite
hollister clothing
ugg outlet
fitflops sale
longchamp outlet
coach outlet online

Gege Dai said...

cheap nba jerseys
longchamp outlet
cheap ray ban sunglasses
jordan shoes
tory burch outlet online
coach outlet online
fitflops uk
ralph lauren polo
adidas wings shoes
michael kors outlet clearance

happy 123 said...

adidas stan smith sneakers
lebron james shoes
chrome hearts online
pandora charms
chrome hearts online store
adidas tubular shadow
yeezy shoes
michael kors outlet
tory burch shoes