Is the Stock Market Heading for a Top?

Is the stock market heading for a top?  Many folks are interested in stocks to buy, but are worried we may be heading for a top.  Read on in the article to learn tips for picking a stock and to see if we’re heading for a top.

First Things First

If you’re going to be investing the in the stock market, first things first.  Only invest with money you can afford to lose.  You should assume if you’re investing that your money will be locked up for five years or more!  The last thing you want to have happen is for a stock you own to go down in trading price the minute you need to sell it to pay for an emergency!

Picking Stocks is Not for Everyone

Warren Buffet – one of the most famous investors – says that most people like you and me should invest in low-cost stock market index funds.  They are easy to understand – and they are set it and forget it.  So, if you’re looking for something simple, look no further.  Purchase SPY and move on!

Still Interested in Picking Stocks?

If you are looking for larger returns and are willing to take on larger risk of a downturn, then picking stocks could be for you.  Some of the biggest returns you can imagine come from folks who picked their own stocks.  Just imagine purchasing Netflix in its early days.  It is up 26,450%!  A $5,000 investment years ago could be worth over 13 million dollars today!  Do I have your attention?

OK – here are a couple simple tips for picking stocks to buy:

1. Check your emotions at the door – investing isn’t for the faint of heart.  Ensure you won’t sell the moment the stock dips in value.
2. Pick a good company – not just a good stock symbol.
3. Know your risk tolerance – how much of downturn can you stomach before you panic sell?
4. Invest gradually – not put all your money into one company and all at once.  Spread it out over time.
5. Avoid over-active trading – you are NOT a day trader!  Repeat that phrase after me!

What About the Stock Market Being at an All-Time High?

You might be wondering why we’re writing an article about picking stocks when some are saying we’re getting ready for a crash.  The truth is, no one knows when the market will make the next correction (go down).  I remember folks talking about the market going to go down in 2013 right after a big announcement from Janet Yellen.  Image how much gain you would have missed out on if you would have been waiting for that dip these past 7 years!

So, don’t let the idea that the market is at an all-time high deter you from investing.  No one knows what the future holds, or how much higher the market could go.  Simply invest a bit each month, and don’t worry about it.  When you’re ready to retire down the road, you’ll be glad you invested!

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When Should You Start Planning for Your Retirement?

Many people do not like to think about the future. Some people would prefer to live in the moment. There’s nothing wrong with enjoying the present but what happens when we don’t think ahead? No one knows for certain what will happen in the future but it’s better to be prepared. We prepare for a lot of things, why shouldn’t we prepare for our retirement fund? 

The young people, and even some of the older ones, think that retirement is still far on the horizon. They understand that it is coming but not in the near future yet, so they delay preparing for it. The question is, when should you start planning your retirement fund? Do you feel you are too young to start saving? Or do you feel you’re too old that you’ve missed your chance already? 

When Should You Start Saving?

Even if you are still looking for a job right now, you can already plan. You can start by setting your retirement goal. Why do you need to prepare for your retirement? Understand the importance. Do your research, ask finance experts. 

The more you understand the importance, the more you are motivated to prepare for it. Understanding the purpose is the key. It’s good to start as early as you can. If you are on your first job now, it’s a great time to set aside for your retirement already. 

One of the challenges though when you are at this early stage of retirement planning – you are still enjoying what your salary can bring. It is understandable, for the first time you are making your own money. Finally, you have the freedom to spend on things you want. 

Pay Yourself First

You can still treat yourself though, but you can do it wisely. One common mistake among young earners is prioritizing spend over savings. They save of what’s left from their salary. If nothing’s left, then there would be no savings for the month. 

What they don’t realize, it should be the other way around. When you receive your salary, allot a portion for savings first. Savings over spend, that should be the priority. You can spend whatever is left after saving. 

It could be hard at the start but eventually you would be used to it in time. As you see your funds increasing, you will gain more confidence in managing your money. Whenever you feel it’s getting difficult though, go back to your goal and why you are doing this in the first place. 

It’s Never Too Late to Start

On the other hand, if you are no longer on your first job – is it too late for you? Of course not.  While it is best that you prepare for your retirement early on in your career – you shouldn’t just throw caution to the wind by not starting on your retirement plans at all. 

You may have some years to catch up on but there are several ways also to increase your retirement funds. Again, research is important, ask questions as well. Talk to the experts so you can reach your retirement goals even if you didn’t start that early. 

Planning your retirement is important. The earlier you start on it, the better it is for you. That’s the ideal but don’t fret if you are a few years late. What’s important is you’ve realized its importance and you are making a way to achieve it now. 

About the Contributor:

Patricia T. Steele likes to write about finance and fitness. She frequently contributes to the Onebed blog, makers of the mattress in a box and adjustable bed frame.

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The 6 Steps to Making your First Investment as a Novice

This post is written by Simon from the UK. Simon writes for Financial Expert.

Few arenas are as daunting for novices as the stock market. If you’ve watched plenty of movies, you might know the stock market as a ruthless place where fortunes are made and lost in a frenzy of adrenaline and machismo.

This might be how 1% of people experience investing, but that Hollywood image of Wall Street couldn’t be more misleading if it tried!

Recent decades have ushered in the great democratization of investing. It is no longer for just the rich, the ‘in-the-know’ and the well-connected.

Advances in technology have meant that investing is accessible to students, grandparents and just about anybody with an internet connection.

Away from the desks of screaming traders; savers and retirees quietly invest in a sensible range of investments and receive a rewarding growth in return.

When you invest in the stock market, you accept the risk that you may lose some of your money. Therefore it is still necessary that you educate yourself and understand the right steps to take before depositing that first dollar in an investment account.

Step 1: Understand your risk appetite

Investing isn’t for everyone. Some people just aren’t cut-out for the uncertainty and stress that comes along with a fluctuating stock price.

Investing beyond your personal tolerance simply isn’t worth it. Is a sweeter return on your investments worthwhile if the sacrifice is lost sleep? Let’s not lose sight of the fact that investments are a tool to improve, not reduce, our quality of life.

Do: Accept the risk of short term losses and resign yourself to the fact that it’s more a case of when, and not if they will occur.

Don’t: Invest on the grounds that you expect to be able to avoid losses, due to good timing or the careful selection of investments.

Step 2: Match your investments to your time horizon

Higher risk investments like stocks are risky because they are unpredictable. While a statistician can tell you that the ‘average historical return’ from stocks is between 8% – 10% per year, this isn’t a short term guarantee. The annual return on stocks could be 20 percentage points above or below that average!

It is only over longer periods of time that these scattered returns begin to converge towards that neat 8% figure.

This is why financial advisers would only recommend stocks to a client if they were able to invest for 5+ years. You should follow this rule too. Over any shorter period, the chance of disappointment becomes quite possible.

Step 3: Design an asset allocation

Before you can begin researching investment options, an earlier choice must be made: how will you allocate your money to different asset classes?

Examples of asset classes include; stocks, property, bonds and cash.

The prices of different asset classes react in different ways to the same headlines. This is because their valuation is driven by different factors.

This makes it useful to combine multiple asset classes in your portfolio and let these ups and downs partially cancel out. This is known as practising ‘asset allocation’, and it helps to generate a smoother return.

If you put too much into safer investments like cash & bonds, your portfolio returns will be reduced. But allocate too much to stocks, and your account value might become too volatile.

Asset allocation is about creating the right trade-off between risk and return that works for you. There are many ‘model portfolios’ online to give you ideas.

Step 4: Pick individual investments

As a novice, you may lack the knowledge or patience to spend time picking individual company stocks and bonds.

The need to diversify across at least 20+ assets to spread your risk means that this individual investment approach can be time-consuming and costly.

This is why many amateur investors use mutual funds/unit trusts instead. When you invest in a fund or trust, you allow the manager to use your money to buy a whole basket of assets in accordance with the investing style of that fund.

Examples of funds include an S&P 500 Equities fund, which invests in every member of the S&P 500 index of US corporations. Funds exist for just about every class of asset, including bonds, property and even commodities like gold.

This is ideal for the investor, who now only needs to make a few purchases rather than 20+. It enables a relatively ‘hands-off’ investing experience.

Step 5: Choose a stockbroker

To get access to your investments you’ll need to become a client of an investing platform.

Investing platforms go by many names, but offer a similar experience:

• Stockbroker
• Share dealing service
• Investment account
• Fund supermarket

The key thing to look out for is whether the account restricts purchases to funds, or whether it allows direct purchases of stocks and bonds too.

Beyond this functionality, the major point that separates the large providers is their fee structure. This is probably what you will use to pick your favourite.

Investing platforms typically charge a quarterly or annual ‘account fee’, plus a fixed fee per trade. Naturally, the less money you pay to your stockbroker, the more cash you will be able to put to work in generating returns.

Step 6: Place your first trade

So, let’s assume that you have decided that you have the right temperament and time period to flourish as an investor.

You’ve drawn up a plan on how you’ll split your money across two or three asset classes. You’ve picked a fund for each, and have found a trusty stockbroker to act as your partner in crime.

The only thing left to do is placing your first trade! This is actually quite an exciting thing to do and there are very few things you need to know.

Your broker will only ask you for the following information:

1) Investment name

You can also search by the unique ticker symbol which each company is assigned. This is usually 2-4 characters. For example, the ticker symbol for Coca Cola is KO.

Sometimes funds issue two types of units – ones that pay dividends and ones that automatically reinvest them. Less commonly, companies themselves can also have multiple ‘classes of stocks’ with different rights attached.

For this reason, it’s usually safer to use a ticker symbol to select your investment to ensure that you’re investing in precisely what you wanted.

2) Number of stocks/units OR amount you want to spend

Brokers allow you to specify the quantity of stocks/units you want to purchase, or how much you want to spend.

It’s advisable to always input your investment as a dollar amount. This way, you let the broker do the math as to how many stocks or units this equates to.

After inputting the information, a stockbroker will produce a final quote that is valid for only a moment (such as 30 seconds). This shows you how much you’ll pay and what you’ll receive in return. Double-check this information then confirm the trade.

After approximately 3 days, the trade will have fully cleared and settled, and the investments will appear in your account.

Congratulations, you are now an investor!

For more information: The author also writes for Financial-Expert.co.uk. Financial Expert is a blog which crams its posts into three free investing courses. Navigate through them to master the art of investing in stocks & shares.

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You Thought Investing in Stocks Could Be Risky?

Many folks consider investing in the stock market as too risky for them.  This is especially understandable as some folks lost over 50% of their net worth during the “Great Recession” if they decided to dump their portfolio during the bottom.

If you are among those that think stock market investing is risky, then you ain’t seen nothing yet!

Spectrum of Risk with Investments

There are many different assets in which one can invest their hard earned money.  Typically, the more risk you take the more benefit you’d like to see in terms of a payout if your speculations are correct.  Here’s a breakdown of typical investment activities from least risky to most risky:

1. Bonds – This in an instrument which is a debt vehicle for a company to borrow money.  If you invest in bonds, you are just getting paid back interest on the loan.  This type of investment will typically have the lowest rate or return.
2. Real Estate – Buying land, homes, etc. can be a little more risky than owning bonds.  But, the upside is that you can expect a higher rate of return.
3. Junk Bonds – Junk bonds are bonds from “riskier” companies which have a higher chance of going bankrupt.  As a result, their loans pay out a higher rate of return that just normal bonds.
4. Stocks – This type of investment is actually owning a small sliver of a company.  If the company does well, then they will eventually return their profits to the shareholders through dividends.  These can be more risky because if a company goes bankrupt, then the shareholders typically lose all of their investment.  You can limit your risk when investing in stocks by investing in a market index fund.  This is basically owning small slivers of hundreds of companies.  The downside is that this also limits your upside as you’ll just do as well as the general market and no better.
5. Gambling – You’ve heard the saying that “the house always wins”?  If not, this means that over a long period of time, you will most certainly lose money when gambling.  Most people do consider gambling as investing, but it really isn’t.  It is pure speculation!
6. Nigerian gambling – If gambling just isn’t risky enough for you, want not crank it all the way up to 11?  Betting on Nigerian sports matches may be your cup of tea!  If you’re going to go all out and dial your risk up, then you better make it count, right?

Final Thoughts

Now that you have a general idea of the risk spectrum of investments, you can decide what is the right amount of risk for you to take.  Remember, taking a greater risk generally can yield a greater reward if you’re lucky.  If you go to the extreme and try gambling with your money, be sure you quit if you ever find yourself ahead.  And if you’re going to try Nigerian gambling, then make sure you only play with money you can afford to lose!

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Checking Out New Investment Advisors: A Step-by-Step Guide

Choosing the right investment adviser can have a huge impact on the return you get from your investment portfolio. It’s not just about moving money into the right vehicle at the right time, it’s also about understanding how to hedge against risks, what balance of short and long-term tactics will work best, and which types of investment vehicles will work for each client. That means there’s a lot more to it than just making sure someone’s credentials are up to date, although that is important. Let’s talk about each stage of considering an adviser:

1. Checking Credentials

When you are looking at any adviser or firm, you need to be sure they are in good standing in their industry. It doesn’t matter if you are going for investment advice or water heater repair, certification and oversight show you someone is committed to doing their best within the safety and quality norms of the industry. For financial advisers, there could be a few places to look.

• The SEC’s database of registered independent advisers
• The collected database of advisers registered at the state level
• FINRA’s records and certifications

To make this easier, the Securities and Exchange Commission has a single search database for their own records and FINRA, and it links to the state records.

2. Complaints and Censures

The records discussed above will also contain any official complaints, as well as any disciplinary actions taken professionally because of them. That lets you see whether any of the complaints had enough merit to warrant action.

3. Reviews of the Adviser or Firm

Just checking the regulatory databases for credentials and complaints will not tell you a lot about the performance of an adviser or what the process of working with that person is like. The best way to get that information is by reading reviews to see what others think of investment advisers. This lets you feel out the less quantifiable aspects of the relationship, too. You can see who is known as a great communicator, who will offer you new opportunities and educate you about new approaches or investment vehicles, and who advocates for caution versus high returns. All of these considerations help investors understand which advisers will share their outlook and enthusiasm.

4. Information From the Firm or Adviser

No review process is complete unless you also look at what your financial professionals say about themselves and their approach. Most firms and sole practitioners today have websites with extensive information about their investment philosophies, professional histories, and focus areas. You can learn about whether they specialize in large accounts, corporate investors, or smaller individual investors saving for retirement. This can also help you choose someone with experience working with investors like you.

Conclusions

You’ll need to decide whether you’re looking for an RIA or an investor who works under a broker. Each has its own advantages and disadvantages, and independent advisers can be expensive for small advisers sometimes. In the end, the right choice for you will have to be the one that allows you to rest assured you are getting the right help for your investment goals. That requires a certain level of personal consideration and even chemistry when it comes to communications. That means your final steps will be to reach out and discuss your goals with individual advisers, to find out what they have to say about their ability to help you. This last step before choosing is basically a job interview for your adviser, so make sure you treat it like one. Be skeptical, but also be ready to learn new things about how they invest. Looking for ideas for questions to ask in the reviews you read is a great way to learn more about what intrigued you while researching an adviser.

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Funding Your Retirement: Financial Vehicles to Get You There

For the vast majority, investments into a 401K, IRA, and high-yield savings account is a way to hedge their bets as they move toward retirement. These provide (somewhat) safe financial vehicles ready for when they reach their mid-60s — options nearly everyone can explore.

But what if you’re bullish with financial independence? What if you’re adamant about another tech bubble or housing collapse? 

Time in the market outperforms timing the market. But, what if you could inject more capital now to show even better returns through compounding? This article explores financial vehicles that may be the items to get when you’ve set a clear financial path to retirement.

Playing Earnings & Gossip

Swings in the markets create opportunity whether it’s going up or down.

Playing Earnings

Earnings create high volatility in the markets with many opportunities for investment plays:

• Earnings run-up and sell before ER
• Short-term options call/ put pre or post ER
• Bearish buy-ins post ER dips

Tools like Stock Earnings present an easy-to-understand feed of which companies are posting earnings. This allows a savvy investor to play into these opportunities with added data. Tools like this also provide screeners and backtesting to discover and experiment with earnings plays, too.

Playing Gossip

There’s also the idea of “Buy the rumor, sell the news” noting the wild ups and downs caused by reporting and “shakeups” at a business. Notable examples are an influence from the POTUS tweets, moments after a CEO leaves, or whistleblower details from higher-ups.

These disruptive moments create wild swings providing new entry-points for bullish investors during dips. Or, incredible options trades for bearish traders. 

Following industry reports and keeping up with the news is the fuel for this financial vehicle.

Income Property & Sharing Economy

One could explore income property as their retirement vehicle:

• Flipping
• Owning & renting
• Owning & vacation rentals

Great capital, credit scores, and knowledge of the housing market creates this opportunity. Though, one could explore it by holding property when downsizing in preparation for retirement — renting the old home to cover new expenses.

One may also invest indirectly through REITs, or real estate investment trusts. This provides market coverage without the headaches and hassle of owning property. It also provides exposure to several sections including commercial property, housing, senior housing, and vacation properties. 

REITs rise with housing expansion while paying hefty dividends. All investing platforms provide access to publicly traded REITs. Or, one could explore similar options through services like Fundrise, Realty Mogul, or Realty Shares.

Your Education

The retirement window is set to grow — it’s already extended 4-months in 2018 alone. This is placing many individuals into a tough situation where they’ll need to work a few more years before retirement.

The job market is already tough, and competition from the college educated will make even entry-level jobs difficult to secure for aging individuals looking to “ride out” until retirement. 

Continuing education is a key component and investment for your retirement.

Consider:

• Workshops
• Online certifications
• Returning to college

This provides a hedge allowing you to explore part-time options pairing with the extra years your investment portfolio grows. And, it can provide the needed education to expand your skills and experience into lush gigs or entrepreneurial ventures you’ve always had on the backburner.

Time is On Your Side

Time provides the greatest returns whether you’re 40-years from retirement or looking in the pre-planning stages. What you do today creates substantial opportunities for your retirement goals by way of compounding earnings and golden opportunities.

Which financial vehicles will you choose to get yourself there?

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Protecting Yourself From Fraud – XTrade Guide

Fraud happens, it happens to smart people, it happens to experienced people – but it rarely if ever happens to traders who have done their research. Researching legitimate and regulated online trading platforms such as XTrade, can be time consuming, yet vital. 

Commodity fraud happens when you trade with unreliable brokers that do not have your best interest in mind.

How can you tell who is legit and who should be avoided at all costs? Well there are many websites out there that offer support, information, and reviews. For example, a reputable platform will have many positive reviews – you can see for yourself by searching XTrade reviews here. Searching sites such as these will offer you advice on which platforms you should choose for your trading needs.

You can also protect yourself by following a few simple rules.  Theses are:

Broker scams

Before you even consider funding an account, you need to search for reviews of the broker. Take what is said and base your decision on logic; could this be just a disgruntled trader or a troll sent from a competing broker?

Are there any outstanding legal actions against the broker?

A big issue that you should consider is to ensure that they are no complaints from traders not being able to withdraw funds. If there are, contact the user (if possible) and ask them about their experience.  This can be the number one sign of a problem broker!

Online contracts

What happens when we see a legal agreement from let’s say, Google? We see the 24 page “document” pop up.   If you are anything like me, you read no more than the first paragraph of legal jargon before skipping to the agree button. You cant do that when opening an online trading account! You must read through all the fine print of the documents before committing yourself and your funds. Incentives to open account can often be used against the trader when attempting to withdraw funds. For instance, if a trader deposits $10,000 and gets a $2,000 bonus, and then the trader loses money and attempts to withdraw some remaining funds, the broker may say he or she cannot withdraw because the bonus cannot be withdrawn.

Read the fine print and make sure to understand all contingencies in regards to withdrawals and whether incentives impact withdrawals.

If you are satisfied with your research on a particular broker, fund an account with a small amount of capital. Trade it for a month or more and then attempt a withdrawal. If everything has gone well, it should be relatively safe to deposit more funds. If you have problems, attempt to discuss them with the broker.

Signal generator scams

Some brokers will sell you services you can’t rely on or even need. They are selling a service to tell you when to enter a trade, and then when to exit. Typically, the trade signals are generated by an automated trading program. This means the service suffers from the same weaknesses as the program, and hence will lose money in the long run. Think about it, if the service really was a long-term winner, then why would they be selling it?  The simple answer – they wouldn’t!  They would trade it themselves and keep all the winnings for themselves.  If you run across a broker selling a signal, it’s time to start walking on.

Sometimes the traders ARE the scammers

Many people claim to be millionaires that made their fortune through forex trading – turning $1000 into 1 million within a year! They have lengthy explanations on why you should believe them.  If you actually read their dribble, you will see nothing but empty, meaningless words. They are always trying to sell you their books, or courses at the cost of thousands of dollars. Real educational resources such as XTrade Academy don’t require huge amounts of money to teach you the basics of good trading. 

Protecting Yourself From Fraud – XTrade Guide – The good guys

Reputable trading platforms such as XTrade always offer quick and efficient withdrawal processes. They are regulated, and offer strong financial resources. You will find it easy to contact them, and you will find many open resources ready to guide you through your trading career.

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What Is a Stock?

So I know this may be on the top of many of your minds.  You know investing is a good and right thing to do, but what exactly is a stock?

Last Updated: 4/30/17

I’m glad you asked – let’s dig in and find out!  If you hunt online, some of the definitions for “stock” are difficult to understand.  I will explain what a stock is by using a hypothetical example.

Getting Started – What Is a Stock?

Let’s say you are living in the mid 1800’s and you are interested in starting up your own buggy whip manufacturing business.  There are four basic options available to you to get your company the funding it needs:

1. Have a rich uncle.
2. Use your own money to startup operations.
3. Take out a loan from the bank or other creditors.
4. Find partners that are willing to invest in your business venture by selling them a stake in your business.

If you come from a wealthy family, then choice #1 or #2 may be a viable option for you to get your enterprise off the ground.  In this hypothetical case, you are not rich – sorry!  Now, let’s move onto option #3 and explore this possibility.  You could take out a loan from the bank if you are able to persuade the bankers that you are not a credit risk.  Bad news again – in this hypothetical case, you cannot find a bank that is willing to take the risk and lend you the money – dangnabbit!  It seems that the only option that will work for your potential buggy whip company is option is #4.

Selling a Stake in the Business?

So, option #4 it is!  Now let’s say you decide to take your yet uncreated company and split it up into 1,000 small little pieces.  We call these 1,000 pieces shares of stock (equity).  If you are able to persuade your friends, family, and other investors to buy a share of stock, they will now own a small piece of your new company.  We call these owners of some of the equity in your new company “stockholders” or “shareholders.”  These stockholders are small owners of the company.

Why would anyone want to purchase equity shares of stock in your company?

Well, let’s suppose that your buggy whip manufacturing company is wildly successful.  Congratulations – I always knew you were destined for success!  The buggy whip manufacturing firm can take three actions with its profits:

1. Sell off all or part of the company (assets) and return the money to the owners (stockholders/shareholders)
2. Reinvest the money to expand business and increase revenues (purchase assets)
3. Pay out the profits to owners (stockholders) and continue operations.

Of course, every company can undertake any number of combinations of these three actions.  In this case, because things are going so well, the business will plan to reinvest half of the profits to expand operations.  The buggy whip business will take the other half of the profits and distribute them out to stock shareholders (owners).

Stocks and Dividends

This payment to shareholders is known as a dividend.  Out of the total pot of money allocated for a dividend, each shareholder will receive a dividend payment in proportion to the amount of stock they own out of the total amount of stock issued.  In this case, after reinvestment in the company, let us assume that there were profits of $500,000 that will be paid out as a dividend to shareholders.  Because there were 1,000 shares of company stock issued and sold to investors, each investor will receive $500 per stock share that they purchased.

Why Do Investors Purchase Shares of Stock in the First Place?

All investors purchase a company’s stock with the expectations that eventually they will be compensated.  These investors are taking a risk by purchasing company shares in the hope that the company will eventually generate a profit.  If profits are continually generated, eventually there will be a dividend once the company grows to its desired size or the company will buy-back shares and reduce the total amount of stock in circulation thereby increasing the value of each stock remaining investors hold.

All long-term investors are ultimately after a dividend.  Long-term investors base the amount of money they are willing to pay for a stock on an estimate of how much money the company will eventually earn and pay out as a dividend.  I will cover concepts behind this method of stock valuation in greater detail in a future post.

Stocks and Risk – All Your Eggs in 3 Baskets?

In the example above, I discussed the stock of a single company – the buggy whip manufacturing company.  You can see that if investors are working to limit their investment risk, they understand the wisdom of investing in 25 or 30 companies.  If investors had most of their money in just two or three companies, any one company could go bust causing them to lose a substantial portion of their investment.

What Exactly Is a Stock? – Final Thoughts

If all of this is just a tad bit difficult for you, then check out this simple Youtube video I made which tries to explain things in simple terms.

Historically, investors motivated to purchase stock in many companies (25-30 or more) had to pay large fees known as trading commission.  Brokers loved this, but as far as the investors were concerned – not so much… If only there were “stocks” that combined the stock of several companies into a single investment.  If such a thing existed, then this “bucket” of stocks would certainly make things easier for us.  There would be no need to purchase and track 25 or 30 separate stocks concurrently…  We are speaking, or course, of a market index fund.

If you are interested in learning more about stock market investing, then you owe it to yourself to check out my FREE book Stock Market Investing for Newbies.

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Reasons to Invest In Financial Planning Services

Financial planning is often the last thing on many individual’s minds. There might be several reasons you’re putting off thinking about saving and investing, but you should reconsider this mindset as soon as possible. There are several times and reasons to invest in financial planning.  You can either teach yourself the tricks of the trade when it comes to financial planning or hire services from a professional financial advisor. As the average life expectancy increases, more people are finding that they did not save as much for retirement as they should have. Here are some of the top reasons to invest in financial planning services.

To Avoid Being Overwhelmed

For many people, anxiety begets idleness. If you’re nervous or unsure about how to tackle a problem, you might put if off indefinitely. Time has a knack for getting away from us, and before you know it you could be quickly approaching retirement age with no sustainable financial plan. This is disastrous and potentially devastating, so visit a financial advisor who will help assuage your fears about saving for retirement. When you’re armed with guidance and a plan, you will feel much better about saving for your future.

Social Security Might Change In The Future

If you think you’ll be set from receiving Social Security checks, reconsider your thinking. It’s possible that Social Security will be completely different by the time you reach retirement age, and it might not provide enough for you to comfortably live off of. It’s important to meet with a professional to talk about your current plan, and to revise that plan as needed.

You don’t want your entire financial plan to hinge on the idea that Social Security will be there for you only to find out that it’s half of what you were planning for!

Marriage or Divorce

The start of a marriage might not sound like the ideal time to consult with a financial planner or to teach yourself how to invest in the stock market.  But, it’s actually an excellent time to consult with a professional about finances or educate yourself on how to invest. Money is one of the biggest causes of tension in a marriage, and putting it all out on the table with an advisor or learning investing together is one of the best things you can do to start your marriage off on an open and honest note.

However, if you’re getting a divorce, it’s a good idea to seek the advice of a professional financial advisor in order to discuss potential losses.

If You Receive a Large Sum of Money

Many lottery winners or people who receive an inheritance are unable to successfully plan financially. They simply come into too much money in a short period of time without the skills necessary to properly invest it all.  With a large sum of money suddenly available, safe investments might not be the most appealing thing to think about. In this sort of scenario, it is usually wise to pay an expert to handle your money for you on the outset.

To avoid spending all of your money in ways that won’t help you in the future, speak to someone who will be able to help you make a solid financial plan. There are many local financial advisors that would be happy to sit down with you and develop a custom financial plan for your specific scenario.

For example, Damian Ornani at Fisher Investments manages the financial consulting firm and his experience, along with other Senior Managers, specializing in investments and retirement saving, and how to help you achieve your financial goals.  If you are looking for a financial advisor, it is as simple as starting a local google search!

When You Get a New Job

Whether it’s your first job out of college or you’ve just moved companies and secured a significant pay raise, it’s helpful to get your investing habits into gear.  Teach yourself the ins and outs of investing or seek out professional financial advice when you start your new job. Your financial plan can’t stay the same when you’ve just had a change in your paycheck. If you don’t have the organizational or planning skills to do it yourself, a financial advisor will help you make a game plan with your new paycheck so you’ll be able to make good decisions that will service you in the future. Whether you’d like to put away more for retirement or invest some of your income, speaking to an advisor can be a very wise choice.

If You Need to Care For a Parent

If your parents are aging and need to be cared for, a financial planner is definitely in order. Care for the elderly is becoming more and more expensive, and it could cause serious familial strain if you’re opting to skip talking to a financial advisor and choosing to work it out with siblings instead. If you want the best care for your parents without devastating your finances, it’s important to start making a plan ahead of time.

Because care of an aging parent can come up unexpectedly (stroke, heart attack, etc.), this can often be pretty difficult to figure out yourself.  Many folks do not have the ability to drop everything and learn how to properly invest.  So, it is often worth it to hire the services of someone who has years of experience dealing with these sorts of matters.

Reasons to Invest In Financial Planning Services – Think Ahead

There are endless reasons teach yourself more about investing or to invest in the services of a financial planner. If you want your life and your loved ones’ lives to be safely squared away for the future, it’s essential to make smart choices and think ahead. Even if you’ve been putting off saving because you don’t have a lot of extra money or you think you have plenty of time to get your finances in line several years down the road, it’s time to rethink your strategy. There’s no such thing as thinking too far ahead, and getting the investment knowledge your need or contacting a financial planner trust is a great step to securing a prosperous future.

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Make the Commitment to Setup an Investing Account Today

Hopefully the series of recent stock market investing posts I’ve been creating here at MoneyAhoy has helped you realize that everyone should be saving for their retirement.  Now comes that hard part – you need to make the commitment to setup an investing account today!  By investing some amount of your annual income in the stock market, you open more financial options for yourself.  If you do not develop the habit of investing periodically at a young age, you will be missing out on hundreds of thousands (or perhaps millions) of dollars to provide for a secure retirement.

It Is Never too Late to Start Investing!

If you have not started saving for your retirement yet through investing, do not panic.  It is never too late to get started!  As the famous Chinese philosopher Laozi once said: “a journey of a thousand miles begins with a single step.”  Make the commitment to yourself to enroll in your company’s 401(k), set up an IRA, or sign-up for your own personal investment account today.

Investing and Debt – Don’t Worry

Even if you are tens of thousands of dollars in debt, you should still be investing for your retirement!  That’s right – company matching and tax incentives will far outweigh the interest you will pay on just about any type of consumer debt.  The previous post on 401(k)s illustrated how you will be better off in the long run if your first priority is saving for your retirement through a 401(k) versus paying off consumer debt.  Unless you have a bounty on your head from a loan shark, or some other sketchy character, investing for retirement should be your top financial priority.

The different types of investments accounts available to you can be a little confusing at first glance.  The recent article I published in IRAs illustrated the differences and similarities between a: 401(k), traditional IRA, Roth IRA, and personal investment account.  Make a mental note of which type or types of investment accounts seems best for you.

Make the Commitment to Setup an Investing Account Today – Final Thoughts

Now that you are convinced that everyone should be investing in the stock market, we are ready to start funding our investment accounts, right?  You bet!

You can start funding your investment account through signing up for your company’s 401(k) or setting up an IRA account with any of the major brokers.  That’s step #1 – just making the commitment to yourself that you’re ready to get started.  Once your account in funded, you can start to learn a little more about stock marketing investing.

Remember – it’s never too late, or early, to get started investing in the Stock Market.  If you are ready to learn more about stock market investing, check out my free 150+ page eBook – Stock Market Investing for Newbies.  If you don’t have an IRA currently, please consider signing up for one today!

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For more saving money, making money, and investment ideas go to www.MoneyAhoy.com