Investing Wisely – The Way to Riches by Craig Dawber

Multiply Your Money – Invest with Care

The investment in stock multiplies quickly. The certificates of deposits may give you interest rates ranging from 4 to 5% depending on the deposit period. Out of the interest that you receive, you have to pay income tax as if it is applicable to you.

The invisible deduction on the interest comes from inflation. The inflation rate of about 3% in USA makes a hole in your pocket without your knowing it. When you consider income tax and inflation together, you may be actually loosing money rather than making money on your certificate of deposit.

Excess Money – Your Saving

The money you every month or year earn is not all spent in the same year. Clever and careful persons always control the expenditure so that they always have an excess of money over the expenditure. This is the rate that drives the future progress of a country

The personal saving rate in USA has been lower at 8% compared to other countries where the rates of 15 to 30% have been the norm over last few years. This excess money is the saving you can invest. Since the savings available in USA is only 8%, the case for investing wisely becomes stronger.

What is the best avenue?

If you can take some calculated risks, the stock markets become the focal point of investing. The increase in the wealth can be phenomenal. An investment of $10,000 made in Microsoft shares in 1986, was worth $3.5 million in 2004. There is no way in which the certificate of deposits can match this kind of increase in personal wealth. But remember not every company has the growth rate of Microsoft.

The General Impression

The general impression about the stock market continues to be bad and the cases of persons going down in stock market become the talk of social circle. No one talks of Warren Buffets of stock markets until they have reached the level of legends. Such legends may be few in number, but there are many Warren Buffets in waiting in wings about which one knows or cares to talk about.

So What Do I Do?

The key is to start investing wisely and go up as you progress. If you follow the tips given below the chances are you might make money sooner than you think.

A warning is due here. Although the tips can be given, there is no guarantee that you will make as you might desire and the rate of your growth cannot be certain. It all depends on how you go about it. None is going to walk you through the phase of investing with a guaranteed return on your investment.

Smart Investing Tips

• Have a plan ready and consult your broker when you make that plan operative.

• Study the market changes and do not be in a hurry to make an investment before you have studied the market movements.

• Although "buy low and sell high" is the stock market mantra, remember that it is not possible to do it always. Whenever you get profit, do not forget to bring it home and re-invest.

• When in doubt, wait and wait. Do move for kill if you find an opportunity. Be ready to take risks if necessary, but the risks should be calculated ones and not reckless.

• Ask when you are not sure. Deal only with the established brokers and develop good relation with the broker. It might pay you in just one deal with that broker.

• Never invest on hot tips, rumors, or inside information. Do not give in to pressure tactics.

• Be on lookout for smart investing opportunity. Once you get it do not let it go.

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