Investing for Beginners: Essentials to Start Investing Wisely

177 Pages·2014·3.2 MB·English

by  Tycho Press

Quick-Start Guide
5 Steps Toward Setting the Right Goals
5 Investments to Avoid
Popular Investments at a Glance
Key Questions to Ask Your Broker
7 Tips to Reduce Taxes

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ISBN Softcover 978-1-62315-445-5 | eBook 978-1-62315-446-2
Contents
Introduction
PART I
Investing Basics
Chapter One Define Your Goals
Chapter Two How Much Will You Need?
Chapter Three Know Your Options
Chapter Four Know Your Limits
PART II
Investment Types
Chapter Five A Walk Through Wall Street
Chapter Six Moving to Main Street
Chapter Seven Alternative Assets
Chapter Eight Picking an Investment Partner
PART III
Investment Strategies
Chapter Nine Starting a Business: The Supply Side of Investing
Chapter Ten Diversify Your Holdings
Chapter Eleven Track Your Progress
Chapter Twelve Minimize Your Taxes
Glossary
Resources
References
An investment in knowledge always pays the best interest.
BENJAMIN FRANKLIN
THE WAY TO WEALTH: BEN FRANKLIN ON MONEY AND SUCCESS
INTRODUCTION
Understanding Investments
If you haven’t yet begun to invest, it’s time to get started. If you already
invest, you should probably step it up. If you already have more than
enough set aside, realize that the word enough is at best a shoddy
estimate, at worst a pipe dream.
Like so many of life’s most important tasks, investing is simple at its
core. You deploy money in the hopes of receiving more back than you
put in. Like paying for college to open up a career path or buying that
Ken Griffey, Jr., rookie card on eBay, you deploy money in the hopes of
getting back more than you originally invest.
We all understand the concept of investing. Unfortunately, way too
many of us make the process more complicated than necessary.
Admittedly, some investments require sophistication and a deep
knowledge of finance. Unless you’ve studied the markets and
understand how they work, don’t let a slick talker persuade you to invest
in credit default swaps, option straddles, or venture capital. All three of
those investments can generate profits, and all make sense for investors
in certain situations. But if you can’t explain the investment to someone
who isn’t an expert, you have no business making it. By the time you
finish this book, you’ll be ready to clear that explanatory hurdle with
most of the investments you encounter.
Part of understanding investments involves knowing how they work
and what you can accomplish by using them. However, knowledge of
investments will not make you a successful investor on its own. You
must also understand the markets themselves, what moves them, and
which moves warrant attention.
But even if you master knowledge of investments and markets, you
won’t make it far without another type of knowledge: an understanding
of yourself, your strengths and weaknesses, and your needs and
capabilities.
Investor after investor has leaped into the financial pool ill equipped
for the swim. You’ve probably met one of them: the guy who complains
that Wall Street is rigged, or that he never gets a break, or that everyone
else is lucky except him. Most of you probably know several of these
tortured souls, battered and discouraged not because investing has been
too tough for them but simply because they haven’t prepared well
enough.
Never before has information been easier to obtain. At the click of a
mouse, you can find not only the price of an investment but also
fundamental data underpinning that price, news about the company,
and in some cases the opinions of professional analysts who track the
security. So separate yourself from the pack not only by acquiring
information, but by learning how to use it.