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INTELLIGENT
INVESTING:
You
Can Do It Yourself
Although
principles of investing and economic jargon may be new concepts to you,
it is important to understand that if you choose to, you can do this
yourself. Understanding investing is certainly no more difficult
than many subjects you already know about. Let's face it, if you
were able to survive a class like Human Gross Anatomy, you are
definitely intelligent enough to understand the simple mathematical and
psychological concepts behind intelligent investing.
The majority of people have the skills, or can learn
the skills necessary to become a successful investor.
Characteristics of the successful investor include common sense,
discipline, planning skills, a
willingness to learn, and a desire to take control.
You Should Do It
Yourself
Most financial resources recommend that
individuals take an active role in their future by making their own
investment decisions. The reason for this belief is simply because
you are obviously the one who is most likely to put your interests
first. Admittedly, the do-it-yourself approach is not for
everyone, especially for people who lack the time or desire to take
charge of their financial future. For these individuals, it is
best to seek the advice of a professional investment consultant such as
a certified financial planner.
You Should Do It
Now
Time is the most powerful ally of the
investor for both minimizing portfolio volatility and for maximizing
returns. This will become evident in the section which discusses
the Power of Compounding, a simple
mathematical concept that is the basis for successful investing.
In general, for every 6 years you wait to begin investing, your required
monthly savings needs to double to reach the same level of retirement
income. But before we begin discussing compounding interest, let's first evaluate your risk tolerance and learn about the basic types
of investments.
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Copyright © 1999 University at Buffalo
School of Dental Medicine
Last modified: August 16, 1999
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