4 Excellent Personal Finance Advices You Should Read Today

How you invest depends on what you know. Some say it takes experience to fully understand how to invest properly. Although the most of the concepts can be abstract and unclear, there are ways and methods to start investing with good practices. The problem is that many people just would not follow the advices, although they are simple to understand. It is often the people who take action rather than doing the thinking (thus doing nothing) that are garnering real success in investments.

You should never invest based on a sales pitch

After listening to an impressive sales presentation about a new investment product, you are convinced and ready to buy. After all, they have all the statistics that are very real and that future trend of the product is the way to go. However, you should also be aware of marketing tactics. Often times, aggressive marketers or salespeople who pitch hard are either making money from commission from low quality products. You will find that the high-end investment products do not get promoted much. They are always regarded as opportunities that people just seem to pass on but get sucked into the nicer-sounding presentations instead.

You must not invest whenever you have doubts or questions

In simple terms, if you do not understand your investment the slightest bit, do not invest. It is as simple as that. So what if you can understand 80% of how an investment works? Be wary of salespeople or brokers who are good at selling. You will find that they will often sell to you products and services that you do not need at the first place. Why are they doing this? So that they could earn a bigger pay check from earning off your sales commission. Find out the track record and past history of the investment before even considering buying it. Get to know how “liquid” it is. Liquid in this case means how readily it is convertible to cash.

Stay away from high fees related products or services

Investments with high sales commissions and management expenses should be avoided at all costs. In fact, you should purchase all of your investments by yourself. The reason is most high commission investments do not perform as well. Chances are, you are better off with investments that cost you lower fees.

You should always keep tax in mind

Getting involved with investments could mean getting your hands dirty. You should be aware of the tax benefits and effects by investing alone. When you are busy investing, take the time to keep note of your taxes too. You do not want to pay higher taxes because of your aggressive investing habit.

This entry was posted in Uncategorized. Bookmark the permalink.