“Money Matters-Investing 101”

Whenever money is discussed, if the conversation persist, the topic of investing will undoubtedly come up. People love to talk about and listen to investing strategies and advice.  I think the appeal of investing in certain vehicles, like the stock market, has to do with the potential to make a lot of money very quickly with little effort.  Who wouldn’t get excited about that!!!  Especially when you consider popular investment vehicles, such as stocks and real estate, have been around for hundreds of years and have worked out well for so many.

But in this day and time, there is always some new product or new philosophy to investing that “guarantees” success. Whether you are a fan of the tried and true methods of investing or chose to venture into some less conventional, new-age product, there are a few things that you need to be aware of.  Although, this list is far from exhaustive, here are a few investing tips:

1. Never invest in anything you don’t understand. Just because everyone else is doing it (or talking about it), doesn’t mean you have to follow in their footsteps. This is a rule the Oracle of Omaha (Warren Buffet), himself, follows. Through the last 30 years or so, technology companies have produced more millionaires and billionaires far quicker than any other sector of business in history. But not for Mr. Buffet. Why? He doesn’t invest in technology companies because, by his own account, he doesn’t understand technology. So how did one of the richest men in the world become a billionaire outside of the popular technologies that made so many other billionaires? By investing in things he was comfortable with such as real estate and service oriented businesses. In the end, you have to know yourself and understand what you don’t know.
2. There is no guarantee when it comes to investing. It doesn’t matter if you are Bill Gates, Warren Buffet, or just the average Joe, there is no such as a “sure thing”. Anyone that tells you otherwise, is trying to sell you something. There is always associated risk; but risk can be minimized through careful planning and wise decision making. Take the time to learn about an investment before you jump in. It’s the wise thing to do.
3. Never invest money you are not willing to lose. If you are hoping an investment will “hit it big” and solve your money problems, your hopes are misplaced and you probably don’t need to be investing right now. Take care of your obligations (debt) first. Eliminate the debt so you can use those dollars elsewhere.
4. There is no such thing as a free lunch. Everything has a cost. If a product or company is offering you a service, it cost them something. And if you are doing business with them, that cost will probably be passed on to you somehow. This may come in the form of fees even something as drastic as lower gain interest rates. It’s up to ask the question, “What’s the catch?”

Investing is exciting; but remember everything we Christians do is to be done decently and in order (1 Cor. 14:40). Investing is no different.  Investing works, but you have to be wise and willing to make it work.  So when you are ready (i.e. out of debt), make wise decisions and watch God bless you for being a good steward.