What To Do When Investing

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Are you considering investing? What are some of the steps to consider when you first start to invest? Where you are positioned in life can to a large extent determine what investments you need to consider. The budding college graduate, the career professional, the energetic entrepreneur and the active freelancer have  as many investment options open to them as there stocks and bonds and mutual funds.

Middle-aged adults who haven’t decided their investments

If you are middle-aged without having seriously considered any investment option, don’t let that bug you. If you have twenty or twenty five years to retirement, consider opening a Roth IRA if you can sacrifice some minor luxuries today, if only for the immense tax benefits you gain on retirement. Remember that this fund gives you the option of regularly “electing” your investment option. This is the ideal way to avoid undue risk and maximize investment earning potential.


Young professionals should consider retirement plans

If you happen to be in your mid-twenties, fresh from graduation and all set to blaze a path through a well-defined career, the investment avenues opening up before you are enormous.

If your employer is offering a retirement package like a 401k with every contribution from your side being matched by an employer’s contribution you can watch your retirement fund grow pretty fast. The wisest course would be to contribute up to the maximum permissible ceilings so that the employer’s contribution is maxed out too. This can be done if you ruthlessly cut out all unnecessary expenditure and stretch every dollar you earn to the maximum extent. If your company permits you, try investing in mutual funds or better still index funds that earn you more money.

Before you push your money into these investments ensure to take some time off to divert cash monthly into an emergency fund, and once this fund is large enough to accommodate three to six months expenses, only then initiate retirement oriented savings.

Websites like money.cnn.com and reuters.com will give you a fairly comprehensive idea where investments opportunities can be tapped fruitfully.





Expanding into mutual funds, index funds and stocks

If you are in the freelancing or business bracket, there are multiple investment options that you can access through a share brokerage website like ShareBuilder Securities Corporation.

  • There are individual accounts for a single adult.
  • Joint accounts for two adults, as can be opened as with your spouse.
  • Traditional/Rollover IRAs to plan for a comfortable retirement
  • Roth or Conversion IRAs to gain valuable tax benefits while maximizing the full potential of your growing fund.
  • The ShareBuilder Education Savings Account for providing for the education of your children.
  • Custodial Accounts specially created for adults to hold money in trust to benefit their minor children.


Electing your investments

Electing your investment option under the IRAs can be crucial otherwise your money will be invested by default in safer but low earning money market funds that will not exploit the full potential of your investment.


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