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5 Questions to Ask Before You Start Investing

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5 questions to ask before you start investing

Investing your money is one of the smartest ways to increase your income. Big names, like Warren Buffett, made their fortune by investing in stocks. And many everyday people make smaller windfalls through investments.

Investing is a way to make your money work for you. You put your money towards something expecting to receive more in the future. While you go to your day job, your invested money is making a side income. That helps with saving up for college, retirement, or a house.

You see the wisdom of investing, but where do you begin? A good place to start is knowing yourself. That’s where this post comes in. If you plan on investing, you need to ask yourself 5 questions ahead of time. This way you have a battle plan going into the investment world.

Are you financially prepared to invest?

There are 3 financial steps you need to take before you start investing.

One, you need to pay down your debts. It’s almost always better to pay off your loans before investing your money. The interest rates on your loans could be higher than the interest rates on your investments. In the long run, you’ll make more money by paying off your debt first.

Two, you want an emergency fund. There are bad investments out there. If you make a mistake, you want some money to fall back on. Also remember that things in life happen. Sometimes you lose your job or sustain an injury. An emergency fund gives you a safety net so you can invest money with peace of mind.

Three, you need to save up for an initial investment. Different investments require different amounts of money to get started. There are ways to invest if you only have a little money. Other investments require a lot upfront. Depending on how you want to invest your money, you’ll need to save up an appropriate amount for the initial investment.

1. What are your goals with investing?

Are you aiming for a short term or long term goal? A short term goal could be getting enough money for an engagement ring. A long term goal could be saving up for retirement.

How much do you want to make? When do you need that money by? Knowing your goals will help you choose what kind of investments to make.

2. What will you invest in?

There’s a lot of options out there:

• Stocks
• Bonds
• ETFs
• Real estate
• Cash flow from a business
• Savings accounts with high-interest rates
• Commodities

And there’s more. Researching your options will help you make a decision. Some investments are riskier but offer higher returns. Conversely, some investments are safer but yield lower returns.

3. What’s your approach to investing?

Different people have different circumstances. A young, single man will make different investments than a mother nearing retirement.

Another factor to consider is personality. One person might prefer taking on riskier investments to gain higher returns. But someone else may be more comfortable investing conservatively. They can go for a low risk, low return investment.

What about you? Do your circumstances affect what kind of investments you can make? Based on your personality, do you see yourself making certain kinds of investments?

4. Who will help you invest?

Are you a do-it-yourselfer? Or do you want a financial advisor? Some don’t mind paying a fee to have face-to-face conversations with a professional. Advisors can be a powerful ally and resource in understanding investment options. Others prefer to do it alone.

Robo-advisors are becoming more popular. They are easy-to-use apps for investing your money. There are a lot of options on the internet. Two popular choices are Betterment.com and E*TRADE.com. These platforms allow you to manage money online.

5. What do you want out of investing?

The most important part of investing is knowing yourself and what you want to get out of investing. Ask yourself if you’re financially ready to start investing. Ask yourself what goals you hope to accomplish.

Answering these questions will give you direction as you navigate the complex world of investing. It will give you clarity on what decisions are right for you.

Will you make mistakes along the way? Sure. But you can make fewer mistakes by answering these questions ahead of time. Save yourself money and time by knowing yourself first.

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7 Blockbuster Drugs Expected To Be Launched In 2020

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Pills falling out of bottle. (Image via Shutterstock)
By Shanthi Rexaline

Biotech stocks had a fairly decent run in 2019, thanks to record deal flow, several path-breaking innovation in drug research & development and the positive broader market sentiment. New molecular entity approvals totaled 48 in 2019, less than the 59 NME approvals in 2018.

The new year is expected to be risk fraught, as lawmakers are expected to step up their rhetoric on drug pricing. Even as the outlook for drug companies remains not-so-promising, some key drug approvals could still impart some momentum to the sector.

The FDA could expedite the review of some drugs, Evaluate Pharma said, citing some approvals in 2019 that came about well ahead of the scheduled PDUFA date such as Vertex Pharmaceuticals Incorporated’s (NASDAQ: VRTX) Trikafta. Trikafta, a treatment option for cystic fibrosis, was approved five months ahead of the PDUFA date.

The following are the drugs with blockbuster potential that could make their way from lab to the shelves, according to Evaluate Pharma.

Trastuzumab deruxtecan

  • Sponsor: Daiichi Sankyo Company, Limited (OTC: DSNKY) & AstraZeneca plc (NYSE: AZN)
  • Indication: Her2 positive breast cancer
  • Status: BLA accepted with priority review status in October and the PDUFA date has been fixed for second quarter of 2020

Palforzia

  • Sponsor: Aimmune Therapeutics Inc (NASDAQ: AIMT)
  • Indication: Peanut allergy
  • Status: PDUFA date of January; A FDA panel, which met in September, voted 7 to 2 that the efficacy data and 8 to 1 that the safety data in conjunction with additional safeguards are adequate to support the use of Palforzia

Ozanimod

  • Sponsor: Bristol-Myers Squibb Co (NYSE: BMY) (came into the company’s stable through its Celgene buy)
  • Indication: relapsing form of multiple sclerosis
  • Status: The FDA accepted for review the BLA in June and has set a PDUFA date of March 25

Inclisiran

  • Sponsor: Novartis AG (NYSE: NVS)(came into the company’s stable through its Medicines Company buy)
  • Indication: LDL-cholesterol lowering therapy
  • Status: NDA submitted in December for use in secondary prevention patients with atherosclerotic cardiovascular disease and familial hypercholesterolemia

Roxadustat

  • Sponsor: AstraZeneca/FibroGen Inc (NASDAQ: FGEN)
  • Indication: treating anemia associated with chronic kidney disease
  • Status: FibroGen, AstraZeneca’s partner in developing roxadustat, said it has submitted the NDA to the FDA in late December

Sacituzumab Govitecan

  • Sponsor: Immunomedics, Inc. (NASDAQ: IMMU)
  • Indication: treating metastatic triple-negative breast cancer
  • Status: After an initial snub, the company resubmitted the BLA and the FDA accepted the application for review Dec. 26, 2019, fixing a PDUFA action date of June 2

Filgotinib

  • Sponsor: Gilead Sciences, Inc. (NASDAQ: GILD) and GALAPAGOS NV/S ADR (NASDAQ: GLPG)
  • Indication: rheumatoid arthritis
  • Status: The NDA was submitted Dec. 16, 2019, with the review period expected to be expedited due to a priority review voucher submitted along with the application

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Trade Chief Robert Lighthizer Says USMCA is ‘Gold Standard for Digital Trade’

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According to US trade representative Robert Lighthizer, the United States-Mexico-Canada Agreement (USMCA) will increase GDP and is a “big win for America,” as reported by Fox Business. Lighthizer said we have what is “really the absolute gold standard on digital trade and financial services.”

USMCA is expected by the Trump administration to bring back or generate 80,000 jobs that are related to the auto industry and “create as much as $30 billion of new investment in the sector.” The problems of US dairy farmers will also be reduced by the trade deal as it will provide new access to American wheat, poultry, eggs, and many others.

Fox Business reported that Lighthizer said USMCA will raise GDP by 1.2 percentage points and create over 550,000 new jobs when fully implemented. “We have the first trade agreement in a long, long time that has the support of almost every business group, almost every agriculture group, labor groups, Democrats and Republicans, so we’re really excited about where we are,” Lighthizer said.

In a December 15 report by CBS News, Lighthizer called the White House’s act of submitting a deal with House Democrats on the USMCA as “the most momentous day in trade history ever.” His statement also referred to the announcement of the first phase of a trade agreement with China.

“It was extremely momentous and indicative of where we’re going, what this president has accomplished,” he said.

The House is expected to vote on USMCA on Thursday, but the day could still change.

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401 K

Senator Rand Paul: Pay Off Your Student Loans With Your 401k

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Senator Rand Paul says you should pay for your student loans with your 401k. Paul’s new legislative proposal, the HELPER Act (Higher Education Loan Payment and Enhanced Retirement), would allow benefits like tax-free money for college, tax-free employer-sponsored plans, no cap on student loan interest deduction, and many others. Essentially, it would allow students and parents to withdraw retirement funds to settle expenses for college.

The act “would allow Americans to take out up to $5,250 from a 401(k) or IRA tax- and penalty-free each year to pay for college or make monthly student loan payments,” explained CNBC.

According to Forbes, “Paul seeks to reshape the way people save and pay for higher education, driven through tax and savings incentives.” He notes that “the current student loan interest rates can be as high as 7% for graduate students and parent borrowers.” Student loan refinancing rates, on the other hand, have dropped to below 2%.

Paul’s critics will likely note objections such as removing money from a retirement account for any purpose that is not related to retirement may not be a wise financial move; many students cannot both save for retirement and pay off student loans; and the annual amount may not be enough to help borrowers make a meaningful impact.

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