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The prevention of Investment Mistakes

With the low cost of oil that many people are experiencing they are finding that they are able to save some extra money.  With this some are thinking of doing some investing.   There are some important mistakes to avoid particularly if you are a novice at investment.

The first thing you want to do is comprise a investment plan.   If you don’t then you may not put enough time and effort into finding the type of investments that are going to best suit you.   The other problem will be is that you don’t have a clear direction moving forward in the future with your investments.

It is also important to be proactive in your investments and not just leave them to chance.   You need to know how they are performing and you need to be able to analyse them, and included in your plan you have to have a long term investment goal.

It’s really important that you don’t jump into the first investment opportunity that comes along to you but instead you do a good amount of research to see what your options are, and what they have to offer you.

While you are going to find that there are many different types of investments open to you and some only require a small amount of start up you still want to make sure that you are not mistaking price for value.   This is more important if you are getting into stocks. However many individuals are really nervous about getting into stocks right now because of the way that the stock market is fluctuating.

Another thing that you want to keep in mind with investing is not to put all your eggs in one basket.   Make sure that your portfolio is diversified so if one investment begins to falter you have the others to fall back on.   You can look at investment such as stocks and bonds, real estate, and other types of commodities but it is all going to depend on the amount of money that you are prepared to invest.

Also, remember when investing that you don’t want to strap yourself cash wise so make sure you keep enough money back in the event of financial emergencies.   If this is your first time investing you want to make sure that you depend on experts to get the right advice. They are well trained in what investments are best for specific type of people.   You also may want to check with your accountant to be sure that the timing is right for you to start your investing endeavors.

 

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Sam Seidman, CPA, CA, LPA
629 Sheppard Avenue West
Toronto, Ontario
M3H 2S3

Telephone: (416) 398-1700
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Chartered Professional Accountant, Chartered Accountant, Licensed Public Accountant

Email: sam@torontoaccountant.ca

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