The United States is one of the best places in the world to live due to the abundance of job opportunities and other future events. However, short of having a six-figure job, investing is an optimal way of realizing your financial potential. Indeed, putting your money to work is one of the best practices for achieving financial freedom and security for future generations.
Many people fail to maximize their financial potential because they’re scared to invest and losing money rather than making it—which is understandable. There’s always risk involved in investing, and there are no sure-fire bets. However, as the saying goes, “No risk, no reward.” Continue reading to get some investment tips that will help you to achieve your version of the American Dream.
Prepare for investing before you start investing.
Investing is the act of buying something, whether it’s debt, company shares, or physical assets with the goal of making more money than you spent. Of course, that means having the capital to start investing and ensure that you’re starting off on the right foot with the best practices. Many people find themselves in the poorhouse due to bad investments. This is usually because they failed to prepare financially before they began investing. So, make sure to establish your investment goals and investigate the possible life of the project before handing over your money.
You should save at least 10% of your gross income for a year before investing. By putting money into savings for investing in future events, you ensure that you’re investing expendable income rather than money you’ll need for living. It’s also important to be aware of the project value of your investment. In other words, do some research to determine whether or not the industry that you’re investing in has a reputation of being successful.
Pay attention to the effects of world events on the NYSE.
If you read Reuters or the Wall Street Journal, one thing you’ll notice quickly is that world events significantly impact investment markets. However, the key is to look for trends in world events that signal that certain companies or industries are about to get a lift in their profits.
For example, gold investing has become a popular trade in recent years. One event that promises to increase dividends for investors is the expansion of Alamos Gold’s operations at their Mexico mine site. If that’s not enough to convince you of the bright future of Alamos Gold, Turkey, this mining company has recently granted mining licenses to Alamos to begin work on their Turkish project—expanding their project even more. With two new operating mines in Mexico and the Republic of Turkey, Alamos seems primed to reemphasize its preeminence in the gold mining industry. If you plan on investing in Alamos Gold, for example, knowing these important facts about their growing company is crucial for you as an investor.
Researching the accomplishments of an intermediate gold producer and their success rate may prompt you to invest in them rather than a start-up company that hasn’t shown much growth or press surrounding its project.
Pick the right financial advisor.
A common bit of misinformation about investing is that you have to be an expert. However, nothing could be further from the truth. Most people work with a broker or financial advisor to ensure they’re making wise investments rather than trying to go it alone.
Before hiring a financial advisor, it’s important to understand what their job actually entails. Financial advisors act as the middle person between the investor and the company that their client wishes to invest in and can advise the investor on the life of the project.
Financial advisors also use their experience and knowledge to assemble financial plans for their clients that are specific to their investment ideas. These mapped-out plans involve the client’s investment goals, their current savings, their budget, the tax proposals, and provide any financial statements. Advisors maintain an active presence when dealing with their clients. Their job is to check any misinformation that the client may be concerned about regarding the investment and re-assess any hiccups that may affect their client.
There are two schools of thought when it comes to wealth. The first school of thought is that resources are limited, and poverty is an inevitability. However, investors see resources as unlimited. They know that by following the best practices that have worked for other investors, they too can create wealth. The future economic benefits of investing in the right companies far outweigh the risks. So, if you want to see your financial statements grow, you’d better start investing—and soon.