A lot of people are afraid of the word investments, simply because they don’t know what to do. It’s money were talking about here, which everyone needs to be informed about and topics like long-term investing, which pertains to your future. So, why would anyone want to get on that roller costar called the stock market and invest when all you hear on the news is the market plunged down 40% and now its up 40% and things like that. The answer is well, you have to invest there are no questions asked! The reason being, inflation. The only way to get ahead of the inflation monster is to make your money work for you and grow. If you put your money in the bank you most likely will only be receiving 1% and if you put your money in the stock market your options are endless. So, how do you know what is the right investment decision to make? Well, the two decisions you have to make at some point in your life are going to have to deal with:
- Asset allocation-you have about five different categories where you can put your money and that is to put some money in real-estate, some money in the stock market, more money in bonds, some money in cash, and maybe a little money in gold or oil. You choose how to allocate your money into these different asset categories.
- Diversification: Simply means drilling down and looking at each category itself.
