If you are scared to take the plunge, these are the 5 steps you should be following.
Step 1: Understand How the Whole Process Works
How did you learn to read ? you started off with A-B-C. First you learned capital letters, then came the smaller ones and finally those running letters. At the end ,you have your own distinguished style of writing and reading . Follow the same logic here. For investing in anything, the first step is to Learn the basics.
Step 2: Learn How To Choose
It is important to know how to go about selecting an investment at the right price-be it shares or gold or real estate. A little bit of research, some theoretical and practical knowledge will ensure that things seldom go wrong.
Step 3: Decide How Much To Invest
You should not throw all your savings at one particular investment because, any investment would carry certain amount of risk. So the answer to the question how much to invest would depend on your risk profile. ( i.e. your risk tolerance capacity )
Step 4: Monitor and Review
Monitoring your investments regularly is recommended. This is more important during volatile times when there can be great opportunities for buying and averaging your cost of investment..
Step 5: Learn From Your Mistakes
Investing is a long, learning experience. You will make mistakes, but also learn from them .When reviewing, do identify and learn from your mistakes. Nothing beats first-hand experience. These experiences will help you emerge as a smart investor.
Stick to these basics and sail smoothly into your financial bright future.