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Collin Harness


Ten Things to Consider Before You Make Investing Decisions

Investing is really personal and emotional there are a lot of things to think about before you make any investment.

    1. What are your long term financial goals?

    Everyone wants to make more money, but you should always begin with the end in mind. How much money do you need to 'retire'? Are you investing for income or growth?

    2. What is your emotional temperament?

    I had to teach myself everything I know about investing. My dad believe the stock market is a 'scam', so he keeps all his money in cash. If you are a hot head and cannot handle volatility of losing any amount of money then it is better to keep cash rather than invest.

    It is important to have an emotional plan for when the market goes does or if your investments are not growing as quickly as you thought they would.

    3. What is your time horizon?

    If you put money into retirement accounts, you should not touch them till you are 59 1/2. I am 33. That is more than 20 years from now that this money is locked away.

    4. How much risk do you want to take?

    Government bonds give you a guaranteed return. Investing in Palantir is no guarantee and will be a wild ride.

    5. Do you want to buy a house?

    Real estate is often the biggest investment a person will make. Think it all the way through before you put your life savings into a house. Real estate is a lot of work.

    6. How much money will you set aside to invest?

    Every person has a limited amount of money that they receive each year to spend, save and invest. You do not want to invest too much money to the point that your daily life suffers. You don't want to resent investing.

    Investing should enhance your life, not detract from it.

    7. How much time do you want to spend on it?

    Investing can take a lot of time if you let it.

    Most people would be better off following Warren Buffett's advice and invest in the S&P500 index fund and call it a day. Just put as much as you can into it and let it ride.

    8. Is everyone on the same page?

    Chances are you have a spouse or a family.

    Make sure that everyone has knowledge. And try to get as close to the same financial goals as possible. Most relationships end because people are not on the same page and have different money values.

    9. Fees

    It is better to do nothing rather than doing something because of the fear of missing out or lack on understanding.

    Do not make any investment before you understand the fee structure and the costs of that investment.

    10. Multiple sources

    Do you need life insurance? Maybe. Maybe not.

    Just like going to the doctor, seek out multiple sources of information on investing topics. There is so much financial information out there. Shop around. Talk to different people to get their opinion.

    11. Solo or team?

    A person can definitely manage their own investments these days with online tools. But you may want to pay a little extra to have someone you can call. It may give you more peace of mind.

    12. What investment platform are you going to use?

    It can be a pain in the ass trying to move from one brokerage to another.

    There are so many options today: Robinhood, Fidelity, Schwab, M1 Finance, TD Ameritrade. Find one that fits your needs and is easy to use.

    13. Write it down

    I hate the land of 'What if'?

    I have realized that a LOT of people live in this ambiguous grey area of life where terrible things could happen. Or they could not happen. The result is to worry about things without creating any type of concrete plan to conquer those worries.

    Write down where you are currently at financially. And then write out a plan to reach the goals of your future.

    I went broke, because I was living paycheck to paycheck and honestly I did not want to look at my bank account because I knew the picture was not going to be pretty. That did not end very well.

    The first step out of that hole was to determine where I was at and then start to slowly work forward.

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