5 Keys to Investing Success
Excerpts from:
Kiplinger’s Invest Your Way To Wealth
#1 Make Investing a Habit
 Create a plan that suits you
 Start small, increase as your income grows
 Take taxes and commissions into account
#2 Set Exciting Goals
 “Financial security”; “comfortable
 Goals should affect
retirement”
 May struggle to maintain interest
 VS. “Million dollar net worth” or
“condo on a golf course”
 Know where your money is
investment choices
 Ability to take risks
 Age
 Job security
 Short term- avoid the
market
 Long term- taxsheltered plans and
reassess assets
#3 Don’t take Unnecessary Risks
 Risk can be losing money OR inflation
 Pyramid of Risk
 The bigger the promised reward the bigger the risk
 Stocks- decline in price or
in bond rates
 Bonds- downgrade from rating agency or in IR
 Real Estate values, Inflation and taxes
 Young vs. Old
#4 Keep time on your side
 See Handout
Gambling
penny stocks,
futures/options,
junk bonds
Mutual funds, stocks,
bonds, investment real
estate
House?, Insurance Policies, Checking
and CD’s
#5 Diversify!!!!!
 One thing goes down, one
 Within investment
goes up
 Spreading the risk
categories
 According to time horizons
 Fixed mix
 40-40-20
 Core portfolio