If your only long-term savings are in your 401k/403b/457 plan, you choose from investment options your plan provides. Your employer should provide education about those options. Ask your Human Resources representative when the next session is scheduled. A limited universe makes the investment selection manageable.
If you have an IRA or other savings the universe of investment options is much greater. You can research investment options yourself and make reasoned decisions. Mutual fund companies, brokerage firms and others have websites that offer information to help you become an informed investor.
If you have friends, family and/or co-workers that have an interest in investing, form an investment group where you can pool your knowledge and talk out your questions. Discussions of investment books and articles within this group can improve your financial literacy.
There is also the pool of parents, siblings, and close friends who are experienced in investing their money. Remember that you do not act on investment advice until you have done your own research. Your income, spending habits, time horizon and risk tolerance are unique to you and don’t always match up to someone else’s investing strategy.
Many people are overwhelmed by the vast amounts of information out there on investments and they want the help of an expert advisor. The best way to compensate a financial advisor is the payment of an annual flat fee rather than a percent of assets for advice. But with limited savings it is difficult to get personal advice at a reasonable price. For example, if you have limited assets a $2000 annual fee for financial advice is too expensive.
So a number of companies have sprung up to give you financial advice that costs you less money. Many of these companies offer more automated investment advice versus personal advice. Others pair you with a planner in your area. Here is a list of some of these websites
WiseBanyon XY Planning Network
No matter if you go solo on your investment choices or get some help, you still need to be the CFO of your life. You cannot give someone else total control of your investment decisions. You should understand the decisions and be comfortable that the investments match up with your goals and risk tolerance. Don’t be afraid to ask any question.
Kowalczyk reminder: Common mistakes of investing are: trading too frequently, Getting swept up in market euphoria, Freaking out with market changes, Putting all eggs in one basket, Failing to rebalance regularly
Warren Buffet of Berkshire Hathaway maxims for stock investing: Stick with quality names and brands, Buy & hold is often the best strategy, Don’t be swayed by daily market fluctuations, Bearish markets present buying opportunities, Diversity and keep trading costs low
MoneyYOYO 