Business and Finance

Archive for January 9th, 2012

As a budding investor there are two questions that always come up: 1. Where to invest money?, 2. Where to invest money? Let me elaborate. There are many different types of institutions to do your investing business with. There are also different types of investment vehicles that you can use to invest your money. Thus the two questions…Here are my thoughts on answering both.

You cannot answer the 2nd question without answering the first. We must find a business to invest our money with. Here, we go to the internet. There are a lot of reputable stock trading firms that have been in business a long time that you can do business with. Scottrade, TDAmeritrade, Fidelity, Charles Schwab, are a few that come to my mind right away. There are also other companies that are on the internet that you can visit. Companies like, Sogotrade, Etrade, Trademonster, and Firstrade.

They may be newer to the stock trading scene but reputable, nonetheless. There are also online banks that you can open savings accounts with like: ING, HSBC, and Emigrant Direct. How to pick them? Here are some criteria that you should consider: reputation, cost per trade, resources, customer support, user friendly. To do this, you must educate yourself on all the options available before jumping into one that has the coolest TV commercial. Research first, figure out what company to invest your money with, then you can answer the 2nd “Where to invest money?” question.

After answering the 1st “Where to invest money?” question, you now know that you can use the internet to do all your investment education, financing, banking, etc. What kind of investments are there? Well, there are savings accounts, money market accounts, Certificates of Deposits (CDs), corporate bonds, municipal bonds, exchange traded funds (ETFs), stocks, mutual funds (load and no load), Real Estate Investment Trusts (REITs), Government securities, and precious metals.

There are more but you get the idea, there are a lot of vehicles to place your money. The right questions to ask yourself are: How much do I have to invest?, How long do I want to invest it for?, How much return do I want?, and What is my risk tolerance?. Once you answer those questions, you will be able to narrow down your choices. Bottom line is do research and educate yourself before jumping in.