Top Investing Myths and Facts

by on June 7, 2018

For far too many people, investing is nothing but a locked black box of mystery and confusion. They believe that successful investors are either lucky, brilliant, sorcerers, or criminals. There is a disturbing amount of truth in all those claims. But there is also a lot of misinformation nested there, too.

Investing is an art and a science… and little bit of madness. But it is even more mad to avoid it. Few people reach the highest level of financial success without investing. It is the ultimate expression of working smarter, not harder. To invest is literally to put your money to work for you. There is only so much money you can make by the sweat of your brow. But there is no limit to how much work your money can do.

What your money needs is a job. And successful people find gainful employment for their idle resources. One of the first facts you need to know about investing is that almost anything can be a good investment. It is not just real estate. You don’t have to be a stock market guru. Here are some of your investment possibilities:

Investment Opportunities

One of the things you can do with your money is invest it in money–currency, to be more precise. Foreign currency investment is one of the best ways to turn a small sum of money into a much larger sum. The foreign exchange market, also known as the Forex market, is the world’s biggest marketplace for those who want to buy, sell, speculate, and exchange currencies.

Beyond markets, you can also invest in durable goods such as gold, art, and other collectibles. Hoarding coins, stars, action figures, and comic books may not be the fastest way to financial freedom, but they are all better ways to invest than making no investments at all. Anything that has a good chance of being more valuable in the future than it is right now is a good investment. Just don’t bet all your money on that X-Men comic with the misspelling on the cover.

There Is No Such Thing As a Sure Thing

Most commentators are quick to say that investing has nothing to do with gambling. But on this point, they may protest a bit too much. A lot of people have lost their shirts investing in things that were pretty safe bets. The fact remains, however, that it is a bet you are making. If you absolutely knew the future, then it would likely fall into the category of illegal investing. Just ask all those insider traders. It is possible to know too much.

That said, there is such thing as a safe bet. A safe bet starts with you not betting more than you can afford to lose. There is always a chance to lose money while investing. You have to understand investment risk. According to Financial Industry Regulatory Authority:

“For example, your investment value might rise or fall because of market conditions (market risk). Corporate decisions, such as whether to expand into a new area of business or merge with another company, can affect the value of your investments (business risk). If you own an international investment, events within that country can affect your investment (political risk and currency risk, to name two).”

Having a Goal Is the Best Motivator

The fact that you should save for retirement early is one of the strongest motivators for early investing. If you hope to retire young while you still have plenty of health and wealth, you need to consider the kind of monthly income you are going to need to keep you in the lifestyle you want for the number of decades you expect to live after you retire from your primary line of work.

Getting your kids into a good university is another motivator. Few people have $100,000 a year to send their kids through law school. That requires some planning. So use whatever motivation is necessary for you to start investing in your future today. A vague desire to have more money is not enough. It helps to be specific and focused.

Make the most of your investments by expanding your investment opportunities, taking stock of the associated risks, and letting a focused goal motivate you to stick with it.

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