I have recently paid off all my debt and am looking to build an investment portfolio. I dont want anything too high risk but i would definatly like to start building my wealth.
what steps should i take to start this process and where should i start. any information would be helpful thank you. ok people speak english... RPL.... 1/2 of capital????
I SAID NEWBIE!!!!!!!!!!!!!!! thanks. Firstly, well done for getting debt free, feels good doesn't it?
Secondly, well done for having the sense to ask the question before charging in.
Now, lets look at the risk thing. All risk is minimised by understanding what you are doing. Jumping out of planes for example seems incredibly risky to everyone except experienced skydivers, because they understand what they are doing. Almost anything is the same, including investing. You have to build your understanding to minimise the risk. If a novice investor saw the risks I (appear) to take they would be horrified, until they understood.
There are a number of ways to build wealth but the two most popular are, property, and shares (stocks). Depending on where you live there are some great property deals around that the moment and banks will kiss certain nether regions of your anatomy if you want to buy their foreclosures. The main reason these two are popular is that they are pretty easy.
If these interest you, then you must start building you understanding first. Read some books on both subjects or investing in general. There are thousands out there so you will be flushed with choice. Think and grow rich by Napoleon Hill is the best start, then, The Richest man in Babylon, Rich Dad Poor Dad, and The Millionaire Next Door. These will give you some grounding mainly in the thinking department but all are bestsellers and for good reason. After reading these you may have a clear understanding of your direction and you can start gaining the knowledge you need in the specifics.
While you are the new kid on the block, be careful, and remember, there are no easy ways, there are no superquick fixes, investments need time to work, markets go up and markets go down ALWAYS, stockbrokers and realesnake agents (realtors) are not, and never will be investment advisors, listen to everyone but believe your gut, if it doesn't sound right, it aint, a great opportunity can always wait a day while you check it out and there are no free lunches. You will always pay big bux for great advice and you will always be happy you did.
Sorry I am generalising but specifics will not help you yet. Good luck and enjoy this wonderful new world.
Jackson You can read this book title intelligent investor. Invest half your capital in equity buy RPL for 2 years and your investment will grew 3 times A great way to start is with a simple, diversified mutual fund.
Usually Mutual Fund Families will send you alot of information with your quarterly statement, giving you an opportunity not only to learn about what you own, but also some of the other products they offer.
If you are just start out I would say 2 things help alot-
1. start simple- explained below
2. Try to use the auto invest-- which moves some money from your checking over to your investment. you can usually do this for as little as $50 and it makes a HUGE Difference over time, especially if you try to increase it as you make more money and get comfortable.
so for keeping it simple- try starting off with one of the following "type" of funds which has a good track record of being stable, and also making money-
a. Try a simple "blue chip" or "Large Cap Value" fund- these are the bigger companies out there that are stable and pay nice dividends
b. Try a "Balanced Fund" which is usually 60-70% stock and 30-40% bonds it is a bit more moderate than all stocks.
c. Try an "Asset Allocation Fund"- this is probably my favorite as the fund will sometimes have some in US stocks, some in international, some in bonds, some in small cap stocks, etc- and you can usually choose them by your own risk tolerance.
I hope this helps, i think you will be happy no matter which way to start, but the important thing is just to start and accumulate assets, you can always adjust the investments later on as you learn more. Some people are happy using the above mentioned ideas over thier lifetime.
have fun! The first step you should take is read a book on the subject. Besides the one the first responder mentioned, I also think "Investing for Dummies" by Eric Tyson will be informative for you.
Step 2. Determine your goals for this money. Buying a car/house in 2 or 3 years means you should save it in a completely different manner than if you want it for retirement in 20+ years.
Since you didn't mention your goals, or risk tolerance, the answer to you question can not be found here. Hopefully in one of the books mentioned. |
