How Do I Invest?

Answer:
There are many ways to begin to invest. However, before

beginning to invest in anything, make sure that your overall financial situation is stable. It makes no sense to put money into the stock market while you owe thousands in credit card debt.

The first thing to do when starting an investment portfolio is to establish an emergency fund. This should be a stable, relatively low interest savings or money market account where you will keep three to six months of expenses. If this is not in place, your motor will go out at the same time GM tanks, and you will sell at the bottom.

Once this is in place, take advantage of any 401K plans that you have through work, especially if the company offers a match. You should choose a balance of stock and bond funds in order to allow growth without excessive risk.

After this, mutual funds are a great way to diversify your portfolio while limiting risk. You should take advantage of steadily putting money in over time. This will allow you to take advantage of ups and downs in the market. This technique usually offers a larger return than to drop big chunks in once in a while.

Remember, the tortoise always beats the hare. Steady will almost always beat “get rich quick.”