In an economy that is as unstable
as ours is today, it’s important to make smart investments with your money to
be able to ensure cash flow for the future and secure financial stability. I
believe our economy has slipped due to a high number of bad investments
particularly, due to the real estate market.
This had an impact on small businesses and their capabilities to invest
properly. In this article, nine steps are explained about small businesses and
investment advice. One of the biggest pieces of advice this article has to
offer is to keep things simple. Try to invest in multiple stocks and spread
your money around so that if an investment falls through, “ all your eggs
aren’t in one basket and won’t find yourself bankrupt ” (nytimes). Two of the
more solid investments are mutual funds and extended traded funds. Several
smart funds to invest in are Vanguard Total Stock Market Index Fund and Charles
Schwab, which follow the trends of the entire U.S. Stock market. The Index fund
tends to be a more stable portfolio than an actively managed fund due to the
fact actively managed funds tend to go for the next hot stock and eventually
the investor cannot keep up with the trends of the market. According to this
article the single most important factor of investing success is asset
allocation, which is the mix of stocks, cash, and bonds in a portfolio. Roughly
50% of your portfolio should be bonds, enough cash for a year of expenses, and
the rest then allocated to stock. Another thing small businesses need to keep
in mind is saving money and planning for the month. With no capital, then no
investments can be made.
Article:
http://www.nytimes.com/2009/06/16/business/smallbusiness/16investing.html?pagewanted=2&_r=2&ref=personalfinance&
that looks like a great article. It gives great basic strategies for any investor to get a good understanding. Bonds are a great market because they are almost risk free, and many bonds are backed by the FDIC. Another great bond is municipal bonds depending on the investor, you can buy municipal bonds that are tax free, state and federal. This can give a greater payoff for the individual depending on their tax bracket. Have you thought about investing in stock or do you already?
ReplyDeleteThis is so true. In the past I usually always just invested in one place, putting all my eggs in one basket so to speak. So like the old saying goes, its better to spread our money out just the same.
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