How to become a successful investor

Anyway here 10 pointers that I read and I believe that they are very important if you want to become a successful investor.

1.0 Start Early. This is self-explanatory. It is like early bird catches more worms. It is really an advantage if you start early because time. If you invest earlier your money is compounded many times than investing two years ago.

2.0 Set-aside cash for emergency. Having a cash for emergency can make you at ease with your investment. It is better to separate your personal money from your investment money. Open two accounts, one for savings while the other is for investment. Park a certain amount that you can use for at least six months or for emergency.

3.0 Know your risk profile. This one is how you can handle the ups and downs of your investment. It is normal that a fund is experiencing the ups and downs of economy but the question is how would you handle if your investments goes down for a while? It is better to ask for advice from an investment advisor.

4.0 Inflation. This phenomenon about money value should be considered. Let me give you an example if you are a newbie in this term. It is actually the value of your money though time. Like if you buy a car today, you cannot buy the same car with the same money value in the future because the price is increasing. Now if inflation has a 4% rate increase per years but your investment has 2% interest per year then your money has less value than the inflation in the future. You better look for investment that has a higher interest rate than the inflation.

5.0 How long can you afford to hold your money as investment. Investing needs time, the longer you can hold it as investment the better. If you need your money less than five years then put your money in less risk investment but be aware that the return is not that higher compared to stocks and equity fund. Equity fund is a type of mutual fund wherein the investment is about stocks though there are more than one stock. They are poll of stocks actually.

6.0 Spread your investments. This is a common sense technique to protect your money from losing. Do not put your eggs in one nest as the saying goes. If one of your investment is losing you still have other investments.

7.0 Invest regularly. It is advisable to invest regularly. The more you invest the bigger amount of money you will reap when the time comes.

8.0 Choose the best investment vehicle. Make a research before you invest your money. Find out about the products and the management of the fund that you want to buy share. Look for at less five years performance of the fund. It should be at less on the top ten lists.

9.0 It should be time not timing when it comes to investment. Many people believed in timing. Yes it is true that timing is the best in every aspect may it be job hunting, building a house but it is not necessary in investment. If you get the timing in investment then you get a bonus but time is the is the most important. You can invest anytime and wait for many years to gain interest. It is best when you invest in recession because when the economy bounce back you will earn more. Still time is a friend in investing money because money is compounded in terms of time.

10.0 Review your investment every now and then. There are many reasons why you have to do it. Maybe you want to change your goals or perhaps you want add more investment. Whatever the reasons you need to review it regularly.

These are my ten pointers on how to become a successful investor. They are the blueprint to become successful investor.

Invest in Mutual Fund

When I paid for my yearly contributions of my pension plans I found out that the company is also offering mutual fund and I inquired about investing. I just tried to invest because I want to put my feet on the water to know how this investment works. I bought two types of mutual fund that time which were fixed-income fund and balanced fund. I monitored these two investments and I found out that balance fund is better although riskier than the fixed-income fund. Balanced Fund is investing in stocks and other investments like bond or securities while fixed-income is purely bond which are secured. As we knew stock earns higher interest but will lose money than the bond. But bond will increase earning slowly so better to invest in balanced fund if you want to earn more. The technique is to invest your money at least five years to earn big return.

Now the question is “when to invest in mutual fund?” Well first of all you don’t have to wait for recession, invest now! Most companies that cater in mutual fund are accepting lower amount that is affordable to the poor who wants to invest. Stock investing will requires you to invest thousands of money. When investing in mutual fund just think that you are depositing money in the bank. Make a habit to invest every month. When the economy is down, the mutual fund also is down like the balanced fund because it is half dependent to the stock market. This is the best time to invest in mutual fund because once the economy will recover, you will earn big. Still any given time you can invest and you still earn big money because the mutual fund will perform better than the time deposit.

By the way choose a mutual fund that has a better previous performance, at less on the top ten best performing list.

Investing in mutual fund is better than time deposit because it earns higher interest though there is a chance that you will lose some value of your capital but historically if you don’t time your investment, you will still earn bigger interest.

Now how to invest in Mutual Fund? There are companies that manage mutual fund, most of them are bank that offers this service. Ask the bank if they offers mutual fund, if they don’t offer this service then look for other bank. Another way is to search it in the internet, look for top performing mutual fund and invest in it. Some website will show five years mutual fund performance base on graphics and NAVPS value. Previous years performance is not a guarantee that you will earn money though.

How to Invest in Mutual Fund

In my case I found a bank that offers mutual fund and it has online services so what I did is, I put money in my mutual fund investment through my online bank. I schedule money every month to place in my mutual fund investment deducted from my bank online account. This process save time and money rather than visiting the bank or the company that offer mutual fund investment. Just save your email receipt.

Compare different mutual fund before you invest.

Mutual Fund Versus Time Deposit

Mutual Fund is risky compared to time deposit because there is no guarantee that your money will earn but when it earns depending on the market, it earns higher. Mutual Fund is now famous compared to 10 or 20 years ago. There are many types of mutual fund like balanced-fund or fixed income fund. If your investing in balanced-fund or the aggressive mutual fund then you must be aware that it is partly invested in stocks which has a higher risk. Fixed Income fund is invested in bond and other money related investment. Still this fund earns higher interest than time deposit. Like time deposit you cannot withdraw the money on the spot, you need to inform the broker before they will give your money.

If you are a person who is not afraid to loss money in a certain time and willing to wait for investment to go up in years then mutual fund is for you. You earn better interest in this investment though it has a higher risk compared to time deposit but still good investment than the stock which is riskier. Look for a mutual fund that has a good performance in previous years but this performance indicates the future performance, it is not a guarantee that you will. Study first before you invest and invest money that you can afford to loss.

I have invested in both mutual fund and time deposit and I must say that mutual fund is better than time deposit.

Invest in Mutual Fund

I started to study about mutual fund. It is actually very popular in United States for a long time already. In my country it is still in its infancy and many people are not aware about it. As a son of perpetual savers I am afraid to lose money too. My parents always advise me to put my money in the bank so that it will grow never realized that the bank is investing my money to earn bigger interest. Right now I don’t park my money in the bank except if I have to pay a mortgage because it will make my payment automatic. Let’s go back to mutual fund. It is actually composed of more than one companies. Meaning if you invest in Mutual Fund, you are investing in many companies at the same time. What does it means? Your chance of losing money is minimal than stock but your chance of gaining is also not that high compared to stock.

Mutual fund is composed of many companies that are actually trading in the stock market. There are mutual fund also that is purely bond or a combination of bond and stock. Now you can differentiate which one is safer and which one is riskier. I invested in mutual fund six years ago just to put my feet in the water and I found out that if you invest in balanced Mutual Fund you will double your money after six years that if the mutual fund is performing well. Just be sure to research first about the mutual fund and who managed it and the previous performance. Although they would say that the previous performance is not a guarantee that the future performance will earn you money but still it is the indication. Why would you place your money in time deposit when you can earn better in Mutual Fund. The bank will just laugh at you secretly.

Here are 8 Ideas to Make Money:

1. Save Money- Yes first and foremost you need to save money in order to make money. You cannot start earning more money if you don’t any savings.
2. Open a mini grocery – This is a very simple business and usually in your own home if you have the area and many passersby. You might think that this one will only generate small income but at least you save some of your salary in the bank. Start small because you do not have experience yet. When it fails no problem because you only invest a small amount of money.
3. Invest in metals like gold, silver and other precious metals. History shows that precious metals always appreciate its value.
4. Invest in lumbers if you have idled land. Lumbers are goof investment because they have low maintenance. Lumbers today is also expensive and good thing about lumbers is that you can make it as collateral if you apply for a loan in the bank.
5. Invest in stock – Beware if you want to invest in this type of investment because this one is risky. Leave it to the expert according to some investment guru if you want to invest in stock. You need to find a good manager or broker to find a good stock. This investment can make you rich though in a short span of time. Just be cautious and study the company before you invest.
6. Invest in Mutual Fund – Right now I am investing in mutual fund because it is safer than the stock. If you want to invest but you lacked knowledge in stock market then mutual fund is for you. What is the difference between stock and mutual fund? Stock is only one company while mutual fund is composed of many companies. That is why the later has the advantage because if one company is losing, you still have other companies to gain. So the losing company can be compensated by the well performing companies. Same as stock, mutual fund has no guarantee that you earn and never loss your investment.
7. Invest in Real Estate – buying a house than renting is the right way especially if the rent is almost the same as the monthly mortgage value of the house. Many people said that house is a dead investment. I beg to disagree because if you buy a house or real estate you can earn money through rental. You can also use your real estate title as collateral to apply for loan. Real Estate can be used to leverage business while stock and other investment can’t.
8. Look for a part-time job like online job. I am talking about creating a blog or apply as a writer if you have a knack for writing. You can also create a website to sell your products. The advantage of online business is that you have a worldwide customers.

These are just common ideas that I can share to you as of now. I know that these eight ideas to make money will make you think what other possibilities to earn money today. 

earn and invest money

This is the new beginning of this blog because I lost all my post here lately. I decided to create this blog long time ago, I think two years ago to chronicle my life experience in terms of investing money and earning. I most say that I learned many things through reading and observing people on how to earn more money by investing. It is not an easy thing to do because most of the time your enemy is yourself. Discipline is a thing that is very hard to follow, you do things the right way now but later on you are back to your old habit which is bad like money spending.

I will advise you to evaluate your attitude towards money, observe how the rich handle their spending and how they invest it. If you can imitate them then chances are you will become rich too. Investing is very hard to do if you are not condition to do it. You need to save money in order to invest. You need to be frugal to save money too. I have something to tell you my friends, it is you who should do this because nobody will. I observed many rich people in my place, they are thrifty even if they can afford to spend money for cars or other things that are most Joneses are buying. The rich knew that their money is very precious and should be invested in good business.

Another experience that I would like to share is the lifestyle of my former Boss. Actually I worked in their Mall for 6 months only and I learned a lot like for example when I visited their house. It was a warehouse and they stay on the rooftop. I never seen any expensive gadget in their room. They used telephone, Home theater, Refrigerator, computer and etc. from the store. They just returned them in the mall and display them for sale after they used it for one month and take another items to be used again in their house. I am aware of these things because I was a supervisor in their appliances section. They car like Mercedes-Benz and hauler because they used them for business. The point here is that they don’t buy anything that are not used to gain more wealth.