Cheap Investments - Is Timing A Contributing Factor To Making Money?

Posted by Esperanza on April 27th, 2021

Have you ever heard of structured settlement investments? If you haven't, there are so many advantages to taking this option. You never have to wait a long time to receive payments from your settlement. This will give immediate money for the things that you need the most.

We also have to look at the facts; 77 million baby boomers are retiring over the next 10 years. That is roughly 25% of the population, a truly staggering number. Where do the boomers have a lot of their money invested? In stocks, of course. What happens when we switch from growth to income, do we keep our money in stocks? No. Investors switch to bonds or other fixed income producing instruments, not all of it but most of it gets switched to bonds.

Build in appropriate timeframes. There is an old saying, "When the tea lady starts to invest in the stock market, it's time to get out." What this means is, when the share market is so high that everyone starts to clamber on board, it has probably reached its peak. There are two ways of successful investment timing. The first is to always pick the low-end of the market to buy and the high-end of the market to sell. This is extremely hard to do. Even the best-informed experts have trouble. The second way is to choose good investments and stay with them over the long-term (say 10 years or more) and ride the waves of the market. For safe, easy investing, choose the second method. Do not buy into the top-end of the market and sell once it starts to fall. You will definitely lose money this way.

In general, tax-free investments will not be as profitable as compared to the taxable investments. But this difference is not big enough to outweigh the benefit of reduced taxes (from tax-free investments). Therefore, it will be smarter to invest in things that are not taxed, although the investment does not yield higher returns.

The good news here is that these good investments can be found in the short list of fund companies I gave you earlier in the form of INDEX FUNDS. They are low cost because they have no sales loads and low yearly management expenses... because they simply invest to track their appropriate index... which IS their benchmark. This same index or benchmark is used as the standard for all similar funds with similar objectives. The difference is that other funds with a high cost of investing often under smart technology perform this same benchmark.

When you first decide to invest there is whole load of information you need to have under your hat. To be honest it is always best to consult a professional, but even if you choose to do this there are some basics you will need to know, otherwise you have no hope of making a wise investment for the future.

Investing can start to become more personal by checking in with yourself. Remind yourself why you are investing. What do your investments really mean to you? They may represent financial freedom. Perhaps they are your security or the potential to live your dreams. They may give your children the head start that you never had. Just as you would expect the sausage maker to be a careful steward of the investment you've entrusted to him, your first responsibility in investing is to yourself. Your investments are important assets in your life. By making investments more personal you will derive greater satisfaction from them and increase your chances of feeling successful in the process.