“To have a successful investing strategy, it is important to have a plan in place before you start investing.”
Before investing, you need to have a plan. This will help you know what your long-term objectives are and what your short-term goals are for that specific investment. You also need to know the risk level of your investment and decide what you’re comfortable with that amount. For example, if you want a potential fluctuation in return of up to 30%, then you wouldn’t be comfortable with investing too much because this could jeopardize your future goals and achieve short-term financial results at the expense of long-term growth habits.
A good way to get around it is by using diversification or having different investments that are spread out over the different assets classes including real estate, commodities and international. It’s easier to carry risk by having these other asset class funds alongside each other rather than singularly investing in equities (stocks). Make sure you look at it as an opportunity for your money; protect your long-term goals, but also make sure there is still room for growth.
1. Do I need to be a financial expert?
No, you don’t necessarily have to be an investment professional, but it’s important to understand the role of cash flow and how managing your expenses can impact your bottom line.” “It’s common knowledge that individuals need to manage their money, but actually putting effective strategies in motion and determining the balance between debt and savings required often seems too complicated.
You don’t have to understand fully advanced financial terms or formulas, however, it helps if you know what they mean. For example, Investopedia defines things like “carrying cost,” “numeraire,” and even understanding how compound interest works around $200 a year can help you understand more of the fundamental terminology that would otherwise go over your head. Once you get more comfortable, then start exploring complex financial plans to see if there’s something better suited for your needs.
2. Is it ethical?
Since when did finance become an ethics issue? Smarter people investing their money can only be a good thing! The problem is that in this overly efficient world where information is readily available and technology keeps advancing faster than human progress, people can make very-biased decisions with trillions of dollars to their name.
It’s easy to see how greed and ignorance lead us towards deception, but those things are easy to avoid as long as you evaluate the person/company you’re dealing with objectively instead of relying on other people who may be biased too. If a company doesn’t adhere to expert recommendations the results should still be positive for 99%+ users anyways because that simple fact guarantees they have better policies in place to protect the people involved.
3. What is “entry-level finance” experience?
Does it mean having common knowledge of what actions are typically required by professionals who take on clients/investors with sizable amounts or not knowing anything about personal finances at all? Before investing hundreds of thousands into an untested virtual currency, there are some facts one would need before making a decision based on hearsay. An intro doesn’t promise you financial specialists are teaching you about Bitcoin, it just means they either have invested in Bitcoin themselves or don’t mind working with people who do if their earning potential is bigger than yours.
4. Is it manipulative?
Your personal finance isn’t created with the sole intention of actualizing your wealth. The more you understand about how money is actually made, spent and invested for financial gains, will help dramatically in terms of being able to judge if anything goes against what’s best for both self-interest (i.e.: investing) as well as benefits society (i.e., saving). This way instead of acting overboard or acting a fool for your own gains, you can reflect on exactly what’s going on. If it seems fishy or shady – put the money back in!
5. Is it obvious?
You don’t have to figure out everything by yourself – instead invest in learning from people who are already familiar with the tactics and tricks behind personal finance. There are plenty of videos & articles all over YouTube explaining how loans work (against your best interests), credit cards (against your best interest), educational institutions (long-term debt against the future generation’s best interest, etc.), banking regulations/offsets for illegal financial trading techniques… The list goes on.
6. Isn’t this just speculation?
All you have achieved by reading this blog is to collect information and develop an idea on how things work which can be substituted with various scenarios in regards to eg. investments versus saving needs, credit cards versus lending services etc. The only thing that’s being speculated about is how things will behave in the long term – which you have to balance with your actual needs this very same year, five years from now or 10+ years from today because everyone knows nobody can predict what could happen as a result of general economic trends and technological innovation.
7. Will I get rich?
The only person who can decide whether or not you will make money is you – by investing wisely (or loss-mindedly if that’s what they call it these days) and through your actions which determines the investment returns. If people around you are doing well, they’ve most likely decided on getting rich with their investments-driven personal finance skills. However, even if it sometimes seems like some lucky ones just started out at times with nothing but an idea, they still proceed to turn their savings/investments into something usable for themselves and their families. Nobody is entitled to the outcome – or even merely a portion of it – as long as precautions are taken against getting fleeced.
Furthermore, if you’re willing to put in the effort, there’s no reason why you can’t make money. It’s not like it’s impossible to make a lot of money if you work hard enough. You don’t have to be rich or even successful – just happy with what you’ve got and doing your best to improve your situation. If you keep this attitude, nothing is stopping you from making a decent living for yourself and/or your family. What should I do?
