What is so exciting about investing? Well, for me it’s sending out a couple of the presidents and watching them all return home with a few of their friends. Another intriguing aspect of it is the thought of burying a tiny seedling and slowly nurturing it into a giant sequoia tree (those huge trees in CA). Then being able to step back and gaze upon it as it blossoms into the largest tree in the world, offering generous amounts of shade to all that lay before it.
Now as you venture out on the precipice of the great unknown, attempting to decipher a potential conclusion that may have a lasting financial effect for the welfare of you and your family, how do you know which way to go? While there are many investment strategies to choose from, how can you know which one is the best for you? Here are the most basic options: 401k (or those like it; e.g. 403(b), 457(b), etc.), IRA, TSP (gov.), mutual funds, bonds, or you can even try your luck with the stock market. Oh, and another valuable alternative would be real estate!!! While each of these investments offer their own route to an improved destination, not all of them offer the journey to success. Some other considerations to keep in mind would be your current situation, your overall goals, and the various risk levels that apply.
While there are numerous options and each of them working in either conjunction with another or completely separate with their own specific variation, they all fall under the umbrella of investing. Now before we open the door and go too far, we need to make sure that a few boxes are checked first. There is a sequence of events that need to be assured before we continue. No one builds the roof without the foundation or the walls being set in place first.
This brings us to the topic of debt; the infamous word that is humbling when its presence is known. I perceive debt as two distinct concepts: bad debt and good debt. If you search it out you will find that not everyone shares this point of view. For me, bad debt is the obvious one that most of us are accustomed. Nevertheless, good debt is leveraged, or in other words, it coincides with risk; also, not all risk is bad, we deal with it every day. It’s our ability to minimize that risk that will help us champion the benefits. Needless to say, bad debt has to be looked upon as a priority that needs to be mastered and kept under control.
Secondly, we need to make sure we have an alternative plan in place, in case of an emergency. No one ever expects to be faced head on with a major crisis’, but they happen. Be smart, prepare in advance and you won’t get caught with your pants down. Start setting aside some cash or other assets that are easy to be liquidated.
Finally, start planning for your retirement years. Take advantage of compound interest, and make your money work for you. As we conclude this brief, but hopefully insightful look into the world of investing, I encourage you to seek out the options that apply to you. Become informed on what your employer’s offering and exploit it for all it’s worth. If they don’t provide a program that you can get on board with, look into the IRA’s, solicit a financial advisor, or as a third option you may ask Crusinberry Properties. We are here to serve and aid those in need, but keep in mind that this is merely an overview on investing. I intend to further define the different components that were mentioned in follow on post entries.
Stay tuned and…
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