Investing isn't a get-rich-quick scheme
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Investing 101

Investments and Financial Planning

Have you ever wondered how the rich obtained their success and then retained it growing? Do you imagine retiring early (or of being able to stop working at all)? Do you know that you should invest, but don’t know where to start?

If you answered “yes” to any of the above questions, you’ve come to the right place. In this guide we will deal with the practice of investing from the ground up. The world of finance can be extremely overwhelming, but we firmly believe that the stock market and greater monetary world won’t seem so complex once you learn some of the terms and main concepts.

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We should stress, however, that investing isn’t a get-rich-quick scheme. Taking control of your personal finances will take work, and, indeed, there will be a learning curve. But the returns will significantly outweigh the required energy. Contrary to popular belief, you don’t have to let banking institutions, employers or investment experts push your money in directions that you don’t understand. After all, no one is in a better position than you are to know what is best for you and your cash.

Regardless of your personality type, lifestyle or interests, this tutorial will help you to understand what investing is, what it implies and how time earns money through compounding. But it doesn’t stop there. This training will also teach you about the building blocks of the investing world and the markets, give you some insight into techniques and strategies and help you think about which investing strategies suit you best. So do yourself a lifelong favor and keep reading.

One last thing: remember: there are no “stupid” questions. If after reading this tutorial you still have unanswered questions, we’d love to hear from you.

Investments 101

Thinking about Investments?
5 Questions to Start You Off On the Right Financial Path…

1. What Is The Purpose Of Your Investments?

Investments must be chosen with a main goal in mind: safety, income or growth. The first thing you need to decide is which of those three characteristics is most important. Do you need current income, growth so the investments can provide income later, or is safety your top priority?

2. When Will You Need To Use The Money?

Establishing a time frame you can stick with is of the utmost importance. If you need the money to buy a car in a year or two you will create a different investment plan than if you are putting money into a long term plan on a monthly basis and won’t need to use the funds for fifteen years or so.

3. Do You Understand Investment Risk?

Some investments entail what I call a level five investment risk; the risk that you can lose all your money. These investments are too risky for most people. One easy way to reduce investment risk is to diversify. By doing so you may still experience large swings in investment value, but you can eliminate the risk of a complete loss.

4. How Much Money Do You Have To Invest?

Many investment choices have minimum investment amounts, so before you can lay out a solid investment plan you have to decide how much you can invest. Do you have a lump sum, or are you able to make regular monthly contributions?

If you have a larger sum to invest, obviously more options are available to you. In that case you’ll want to use a variety of investments, so you can minimize the risk of choosing just one.

5. Have You Made A List Of Available Investment Choices?

Too many people buy the first investment product presented to them. Better to lay out a thorough list of all the choices that meet your stated goal. Then take the time to understand the pros and cons of each. Next, narrow your final investment choices down to a few that you feel confident about.

Talk to one of our Investments Advisers Today! Read More about RRSP’s and Retirement Savings Plans.