Smart investments for young professionals
You've just pocketed an awesome graduation gift - the kind that folds. Or perhaps you scored a nice sales bonus at work. Maybe you even received a hefty tax refund from Uncle Sam. No matter what the source of the cash - whether it's a modest Rs 5000 or a meaty 5,00000 - you now have the happy task of figuring out what to do with it.
Snap out of it. True, this kind of dough is enough to drum up some serious fun, yet not enough (not by a long shot) to allow you to declare financial independence and withdraw from the nine-to-five set. Still, if you cultivate your stash carefully, it can become a powerful tool to help you realize your dreams and financial goals. After all, "It doesn't really matter how much money you have to invest to begin with," says Don Phillips, publisher of Morningstar Mutual Funds, a Chicago-based mutual funds ranking service. "The trick is to get into the game."
Before you consider locking even a cent of your newfound nest egg away, however, make sure you have enough extra cash at the ready. Typically, financial advisers suggest keeping at least three to six months' worth of living expenses on hand to cover any unexpected financial demands. "To really make your money grow, you'll want to invest it someplace for several years," explains Lynn Ballou, a financial planner in Lafayette, Calif. "And because investing can be risky - a market may drop or dry up just when you want to cash out - you shouldn't do it with money that you may need to live on."
Beyond that, if you can commit your money for five or more years, you'll want to steer it towards faster-growing vehicles. In general, that means stocks: Over time, they've outpaced almost every other type of investment. Going back 50 years, for instance, equities gained an average of 12.6% per year, while corporate and government bonds and Treasury bills sputtered along at about 5%. Meanwhile, inflation (as measured by the consumer price Index) ticked up at an annual rate of 4.3% over the last half-century.
Thus, "if your (investment) horizon is long, the place to be is in stocks," says Ivan Thornton, a financial consultant at Shearson-Lehman Brothers in New York. "In fact given the way inflation cuts into your spending power, you can't afford not to be in them." The question, then is which type of stocks? And what are the best ways for young people to get into the market?
Snap out of it. True, this kind of dough is enough to drum up some serious fun, yet not enough (not by a long shot) to allow you to declare financial independence and withdraw from the nine-to-five set. Still, if you cultivate your stash carefully, it can become a powerful tool to help you realize your dreams and financial goals. After all, "It doesn't really matter how much money you have to invest to begin with," says Don Phillips, publisher of Morningstar Mutual Funds, a Chicago-based mutual funds ranking service. "The trick is to get into the game."
Before you consider locking even a cent of your newfound nest egg away, however, make sure you have enough extra cash at the ready. Typically, financial advisers suggest keeping at least three to six months' worth of living expenses on hand to cover any unexpected financial demands. "To really make your money grow, you'll want to invest it someplace for several years," explains Lynn Ballou, a financial planner in Lafayette, Calif. "And because investing can be risky - a market may drop or dry up just when you want to cash out - you shouldn't do it with money that you may need to live on."
Beyond that, if you can commit your money for five or more years, you'll want to steer it towards faster-growing vehicles. In general, that means stocks: Over time, they've outpaced almost every other type of investment. Going back 50 years, for instance, equities gained an average of 12.6% per year, while corporate and government bonds and Treasury bills sputtered along at about 5%. Meanwhile, inflation (as measured by the consumer price Index) ticked up at an annual rate of 4.3% over the last half-century.
Thus, "if your (investment) horizon is long, the place to be is in stocks," says Ivan Thornton, a financial consultant at Shearson-Lehman Brothers in New York. "In fact given the way inflation cuts into your spending power, you can't afford not to be in them." The question, then is which type of stocks? And what are the best ways for young people to get into the market?
Making Yourself Smart InvestmentsThere is a harsh fact about reality; the good job that you have may not last your entire life or career. The stability of the job may change and the particulars about it may change it to one that is completely undesirable. You must think ahead and plan on making your money work for you. No matter how much you have, you must plan on saving at least three months salary for a rainy day.
Additionally you must set aside a proportion of your salary to invest now in well performing businesses on the stock exchange, as well as through available mutual funds which have a superior performance and you should consider investing in real estate. Particularly you should consider real estate that you can fix up for rental properties.
Stock investment on the internet in one such new technological avenue. Stock brokers have understood long before the public the great advantage that the speed of the internet gave them in financial matters. They offer to the public the advantage of internet sales and buying of company stocks and mutual funds.
At least seven years ago the stock market utilized proprietary computers, intranets, wide area networks (WANS) to manage and predict the public sales and purchases of commodities, stocks, and bonds. The market place is a very competitive place.
The government and stock market board exist to provide a fair market where no one person or block of investors have a larger influence than any other. Prior to the internet and the 21st century only large blocks of investors or extremely wealthy ones could purchase stocks and commodities as an investment. This is because they were limited to how small or large a package of stock could be sold.
When banks or other groups of investors, retired math teachers, became involved then investment packages could be subdivided smaller. Hence more people could afford to invest their surplus cash into more risky but profitable ventures. The invention of the telegraph allowed the transfer of information at the speed of light. After this, the invention of the Teletype maintained the technological edge into most of the 20th century.
When the age of the personal computer arrived then financier Mr.Bloomberg advanced both the electronic management of stock but provided the pioneer work to facilitate the inclusion of the internet into the confines of Wall Street.
You can acquire attractive properties which require very little in the way of repair. Some only need cleaning and painting to become profitable rentals.
I remember walking several miles along the edge of several housing divisions which were marked by the rarity of an occupied house. Most were marked by the "For Sale" signs and tall unmown grass. There are some real bargains here in Tulsa for those with good salaried jobs! These can become a smart investment for you which has stability and that can increase in profitability over the years.
Additionally you must set aside a proportion of your salary to invest now in well performing businesses on the stock exchange, as well as through available mutual funds which have a superior performance and you should consider investing in real estate. Particularly you should consider real estate that you can fix up for rental properties.
Stock investment on the internet in one such new technological avenue. Stock brokers have understood long before the public the great advantage that the speed of the internet gave them in financial matters. They offer to the public the advantage of internet sales and buying of company stocks and mutual funds.
At least seven years ago the stock market utilized proprietary computers, intranets, wide area networks (WANS) to manage and predict the public sales and purchases of commodities, stocks, and bonds. The market place is a very competitive place.
The government and stock market board exist to provide a fair market where no one person or block of investors have a larger influence than any other. Prior to the internet and the 21st century only large blocks of investors or extremely wealthy ones could purchase stocks and commodities as an investment. This is because they were limited to how small or large a package of stock could be sold.
When banks or other groups of investors, retired math teachers, became involved then investment packages could be subdivided smaller. Hence more people could afford to invest their surplus cash into more risky but profitable ventures. The invention of the telegraph allowed the transfer of information at the speed of light. After this, the invention of the Teletype maintained the technological edge into most of the 20th century.
When the age of the personal computer arrived then financier Mr.Bloomberg advanced both the electronic management of stock but provided the pioneer work to facilitate the inclusion of the internet into the confines of Wall Street.
You can acquire attractive properties which require very little in the way of repair. Some only need cleaning and painting to become profitable rentals.
I remember walking several miles along the edge of several housing divisions which were marked by the rarity of an occupied house. Most were marked by the "For Sale" signs and tall unmown grass. There are some real bargains here in Tulsa for those with good salaried jobs! These can become a smart investment for you which has stability and that can increase in profitability over the years.
