Investing your money should not be a herculean task. However, the many complications that abound about investing makes it look cumbersome. As many people lament on losing their investments, others smile daily for smart investment choices. The difference is in the rules. To improve your investment experiences, here are the Top 5 Smart Investment Rules. Get ahead of the game and play smart.
The Top 5 Smart Investment Rules provides a guideline to guarantee your investment returns. Make out time and study these rules. Knowledge is power only when it is applied diligently. The ball is in your court to play now. If you must invest, then you have got to invest smartly.
Top 5 Smart Investment Rules
Have A Financial Plan
The first rule of investing is to have a financial plan. The plan you have goes a long way to determine the type of investment to pursue. Having a financial plan allows you the freedom to know how much you allocate for investment. As we all know, plans give direction for actions. The same is obtainable in investing. Have a financial plan that includes you target, then seek out investments that suits your plans.
Be Prepared For Opportunities
They are several investment opportunities around us but we often fail to recognize them. It is either we are blind or ignorant to such opportunities, or we lack the necessary skills in appraising such opportunities. The author “Rich Dad, Poor Dad Series” Robert Kiyosaki said, “If you are not prepared with education, experience, or extra cash, a good opportunity will pass you by”. So, investors must be prepared to seek out opportunities by being prepared. Get smart investment books and read, have some savings handy and you are good to go.
Do Your Research
Do not jump into any investment you see. The Golden Rule is this: Do not invest in what you do not know”. It is as simple as that. Before you delve into any investment, take out time and study the pros and cons of such investment. An investor must be an intelligent being and not an emotional one. An emotional investor acts impulsively and intuitively. The intelligent investor however, deals on facts and figures. Never be in a hurry to invest, or you’d hurriedly lose your capital.
Diversify Your Investment
You have heard it said, “Never put all your eggs in one basket”. Eventualities and uncertainties occur daily. Diversifying your investment base is a smart choice. You do not have to lose your money in case of any sudden crash. You are also exposed to various opportunities which put you in a position of power. Be smart and diversify your investment; not only does it guarantee a level of security, it also gives you multiple income sources.
Be Willing To Take Risk
Smart investors understand the value of investment. No investment guarantees you 100% risk-free venture. However, this risk must be evaluated. Robert Kiyosaki has this to say, “If you had a nephew with an idea for a burger stand, and he needed $25,000, would that be a good investment?” “No,” I answered. “There is too much risk for too little reward”. “Very good,” said rich dad, “but what if I told you that this nephew has been working for a major burger chain for the past 15 years, has been a vice-president of every important aspect in the business, and is ready to go out on his own and build a worldwide burger chain? And what if you could buy 5 percent of the company with a mere $25,000? Would that be of interest to you?” “Yes,” I said. “Definitely because there is more reward for the same amount of risk.” Be willing to take smart and informed risks.