Top 10 Things To Do Before Investing A Single Dime

So, you want to get rich or at least comfortable in life? Well, you bet, all of us do. Who doesn’t want to be sipping a joy-laced Peñacolada in a hummock on a white sandy beach wherever you think you want to be.

But hey, dream on! We’ll all get there. But first before you paddle your canoe towards the dreamed promised life, remember that you might be crossing seven seas over turbulent waters, will be climbing seven mountains and finally will be fighting seven monsters with seven heads.

That’s a lot to take. But even without those mountains and monsters ahead, you may not even get close if you are misguided in your investment ventures.

That’s a lot of sevens, but there are only 10 on my list. Anyway, read on!

1. Pay-Off Debts

Whatever debts you have pay it off. Paying your debts makes you earn more than 24 percent returns than by delaying or not paying your debts first.

2. Emergency Fund is a Must

Have a separate bank account to only contain your Emergency Fund. Fill it up with at least 3 months worth (but preferably 6 months) of your living expenses. According to expert financial planners, this is standard and of course word of mouth. But if you can go beyond expected – who don’t want that?

3. Household Budget Input and Output

You’re inside your kingdom and therefore you must obviously know the ins and outs of your budget. Know where your money is coming from and know where it is going – no brainer.

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4. Financial Goals

Set financial goals to simply know where you’re heading to. It doesn’t matter if it’s long-term or short ones – educational plans, vacation, business, charity. This is just to set you into the right direction when you hit the road for investments.

5. Know Your Risk Tolerance

Whatever investing you want to do – business venture, real estate, lending and most specially stock market – you really have to know your emotional pocket first. How much of the money you can afford to lose, if in case things would go haywire, that you will still be able to retain your mental and emotional sanity?

6. Budget Allocation

Determine how much of your asset goes to what investments. Do not let the market decide it for you, the market does not care. So, decide with confidence. And never ever use the money that you use for the daily contingencies of your family – budget for electricity bills, water, internet, meds etc. Set aside a dedicated budget for investing specially for stock market.

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7. Time Frame

Set a time frame. One corporate speaker said, “..the secret to finishing a project is to define a project and give it not enough time.” We oftentimes are constrained to finish a project when we are at the neck of time rather than in the abundance of it. Setting your investment timeframe will push you to be wiser and more vigilant about your investments.

8. Setup A Brokerage Account

In the field of the stock market investing, you cannot just get rid of the middle man. You cannot buy stocks without a brokerage account. A common financial advisor next door will be very helpful in doing this. Additionally, with the aid of today’s technology, you can actually set-up your own account at the click of your finger. Learn here and choose for yourself the Top Online Brokerage Companies »

9. Knowledge Base of the Socio-Political Ambiance

One of the greatest determinants of stock market fluctuation are the socio (social) and political conditions of a country. Investors tend to be more cautious in a volatile social, economic and political environment – such as pandemic, political upheaval and economic downturns.

10. Research

Very basic. Research first the investment module you want to venture into. Never ever invest in something you did not even read or much more even heard of.

You want to learn more about investing? Sure, right here »

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