Investing is probably one of the most important things you can do. We invest everyday, and it's not just about money. What we eat, what we buy, what makes us happy all contributes to our future and health and where you will be. A lot of people don't want to think about it or find it hard to understand, but you can learn it. You want to be able to retie and life the lifestyle you'd like to live. The one key is to deversify, to cover all your bases because if it's in one thing you rely on that for your future which can change the way you invest.

Investing in the market

Since 2008 crash I have taken heavy interest in where I invest, this alone has helped me to understand parts of the whole industry.

  • Investing isn’t gambling if you find the right companies that you believe in and they have good financials and a plan. News can heavily influence a stock and people’s decisions to invest. These are moments when you can take advantage and invest in what you believe in at a good price.
  • Sticking with a strategy helps. Changing your strategy based on the market reactions can create more problems. As long as it’s money you don’t need tomorrow then you'll have plenty of time for it to correct itself. 
  • Diversifying helps maintain calmness. When you are spread over many investment ideas you are bale to think more clearly about the decisions you make and they only effect a portion of your investment.
  • Only invest money that you don’t need with-in 2 years. Anything sooner may force you to sell something at a loss or a gain that hasn't quite peaked yet. Unless of course you switch it into another investment.
  • “Throwing your money into a stock with out doing your due diligence is gambling”.
  • Be careful what you listen to. Sometimes it's best not to discuss your interests with other as any information can influence your strategies. One of the main things hear a lot is people talking about how much money they made or could have made if they purchased a stock. You rarely hear about all the loses they made. It takes discipline and time to mange the emotion, psychological effects of your money invested. Start slow and over time your can start to manage any fears. When you read a lot of stories telling you to buy into a company you might want 
  • There is nothing wrong having a financial advisor, this can be one way of also diversifying your assets. Even though you may have a financial advisors you are still the manager of your money. The main thing is you should not look to blame anyone as it’s your decision where you choose to put your money.
  • Finding a good source of news is important. Being able to compare that with other sources helps for credibility. Find your investment style and try to find people who invest in the same way. 
 

401k plans

Unfortunately I'm not a fan of the 401k plans sent in place for most employees. The growth is slower than the actual market due to the structure and also fees taken and when it comes down I'm sure you take a larger portion of the loss. Though there are some benefits to having 401k's for tax reasons but some would say you might be better taking your taxed money and putting it in the S&P and leaving it there. That way you'll get the full effect of the market. Only problem is that it's cash and you may be tempted to take it out. A 401k gives you no choice but to leave it there. I just don't think $18k a year is enough money with growth to live on especially if you life more than half of you work life after. Thats why other investments are key also, especially a place you plan to live.

 

Real estate

Buying a home can be one of the best investments you make. There are many thing to think about when you want to own a home. Cheaper than rent, Tax deductions on the interest paid on the mortgage, Buying in a school district, saves money on private tuition.

  • If you buy a home long term helps. If you plan to flip a home in 2 years those days have gone based on moving costs and so forth. It’s about living in a place you can grow and have it become an investment for you.
  • If you are buying in your 20-30 you have to remember you haven't peak yet and your salary tends to go up, so even though monthly payments may seem daunting it's sometimes better to risk a little more when younger.  
  • Also 30 year fixed are pretty safe if you plan to stay long term, you can always make extra payments. Just remember once your money is in your home you can only get it out once you sell or refinance, so a mortgage can be good as it gives you more cash to have when you need it though you will pay more off on a mortgage.
  • Buying in a good school district is always an advantage whether you have kids or not. It gives your home another selling point. Schools and district can change though. Find area where there's a lot of parent contribution as this is also a key factor in stong schooling support.

Streeteasy has been a great tool for me. Everyone assumes their broker will find them the right place but people can't see everything. Understanding any investment field is important, you want to be able to challenge anything a broker might say to you just to try and sell something, remember they have huge gains to make on a sale. There is enough information out there these days to do your research and even know more about a building that you are interested in than the actual broker.

 

Investments at work

When you work for a company study the benefits they offer. Healthcare is one many don’t understand. If you are healthy and you rarely go to the doctor it’s a good idea to be on a high deductible plan as your costs will lower for many years that that if your health does change one more costly year won’t affect the average over time. Also they allow you to invest in tax saving HSA accounts for many medical purchases.