So you think you want to start investing, or at least be able to understand all the choices available to you for your 401K plan. That’s great, but if you are serious about creating an investment portfolio for yourself, proceed slowly and with great caution. The world of investing can be profitable, but it also comes with great risk. Never invest more than you are willing and able to lose. All investment opportunities should come with a prospectus, and it should be reviewed thoroughly. It’s important to understand that no opportunity can promise or guarantee big returns. It’s just not possible. So if you’re getting a hard sell to invest in something and the pitch is full of promises and outrageous claims, walk away.

Let’s stop here to say that you should never venture into investing on your own. A good broker or financial advisor you can trust is absolutely necessary. They will talk to you and ask about what your goals are for investing. Someone who wants to create retirement income for themselves will be steered toward very different investments than someone who just wants to try the stock market. Remember, the more risk you are willing to take, the more you stand to lose. Start small, and learn everything you can about the different investment opportunities-stocks, mutual funds, oil and gas investment companies, and so on. Your broker or advisor can help you choose the best ones for your situation. Don’t rely on anyone else for investment info, and be especially wary of anyone who has hot stock tips or inside info on a too good to be true investment. Don’t even think about trusting any you get via unsolicited email!

It’s important to invest wisely and know when to cut your losses. Most people who invest are not going to become millionaires, but if done right and with a little luck, you can create a healthy income for yourself. Again, never invest more than you can afford to lose, because losses do happen and there isn’t much you can do about it. If you have solid proof your broker purposely misled you about an opportunity or is not operating in your best interest, you can file a complaint with the regulatory board. If they find in your favor, you’ll be compensated, but if you just made an investment that didn’t work out, you are just out of luck. So invest smartly and do your homework!

Smart Investing