| Once you have your personal finance house in | | | | living and have no financial education, especially in |
| order another area of finance, personal investing, | | | | the investment and investing arena. Stocks and |
| looms as a challenge. How do you finance major | | | | bonds are not that difficult to understand, but |
| goals like retirement? Personal investing is the | | | | without any financial education or background, |
| answer, so here are some investing tips to help | | | | they may as well be a foreign language. The best |
| you avoid disaster. | | | | investment tip I can give an inexperienced or new |
| Get your personal finance foundation on firm | | | | investor is to start investing with mutual funds. |
| ground before rushing into personal investing in a | | | | These funds were designed for the investing |
| big way. Poor credit and money management can | | | | public. They offer diversification and professional |
| force you into bankruptcy even if you have | | | | management at a reasonable cost. You can invest |
| considerable assets. Scenario: You pay $1,000,000 | | | | large or smaller amounts and have access to your |
| for a house putting next to nothing down in 2006. | | | | money on any business day. |
| The only real money you've saved has been in | | | | Now for some mutual fund investing tips. |
| your 401k at work, which is 100% invested in | | | | Different funds have different financial objectives, |
| stock funds and company stock. A few years | | | | risks, and cost structures. Get your feet wet with |
| later you lose your job as your employer falls | | | | the safest funds, money market funds. They pay |
| upon bad times, the stock market falls like a rock, | | | | interest in the form of dividends, their share price |
| and your house is worth $700,000 if you're lucky. | | | | does not fluctuate, and the cost of investing is |
| Sound familiar? | | | | usually low. If you need some or all of your |
| If you can't pay your bills you are technically | | | | money back there is little chance of taking a loss. |
| insolvent. In the above case you go broke and | | | | Once you have some money accumulated there |
| end up with a lousy credit rating at the same | | | | start small in stock funds if you are younger, and |
| time. The truth is that millions of Americans have | | | | bond funds if you are closer to or in retirement. |
| invested in real estate they couldn't afford and | | | | Bond funds pay higher income in the form of |
| stocks investments they didn't understand; and | | | | dividends with moderate investment risk, while |
| many paid dearly for their financial mistakes. | | | | stock funds feature higher profit potential along |
| Concentrate on personal finance first: your | | | | with higher risk. |
| insurance needs, credit management, and a cash | | | | Mutual funds do the investment management for |
| reserve to cover financial emergencies should be | | | | you. Your job is to pick the fund(s) that have the |
| your first concern. The truth is that as long as | | | | same financial objective(s) you do. The best funds |
| you can stay current on your bills and you have | | | | in terms of the cost of investing are called no-load |
| an excellent credit rating, you're still alive financially. | | | | funds. They have no sales charges or |
| Any weakness in the above personal finance | | | | commissions, and your total cost to invest can be |
| areas makes you vulnerable to financial disaster. | | | | less than 1% a year. If you're ready to get into |
| Personal investing is the area of finance that | | | | personal investing, look no further than mutual |
| puzzles many people, even some who are well | | | | funds... the new investor's best friend in my |
| off financially. After all, most folks work for a | | | | opinion. |