The best investment advice you’ll ever hear, and most likely to ignore, is to save. My depression era grandparents probably said that a million times, and I didn’t listen either until recently. This article “How To Get Rich, Really” says is better than me. But more money is lost in most “investing” than is gained. Think about it, if everyone is winning at their investments, where is the money coming from? Who is losing?
I was recently reading the investment blog PragCap.com – I can’t find the article, but in the comments section a couple obviously very smart and successful investors were counseling a novice investor who asked what he should investing in. They more or less said “nothing”. If you’re a novice don’t invest. They also counseled him to invest in himself – increase your personal earnings ability, and then save. Then, pay off any high interest debt – even a 5% mortgage, when the best you can hope for in investing is below that, should be paid off first. Lastly, only invest in something you are an expert in.
Boring post you say? But trust me, it is one of the most profitable things you will do in your lifetime if you heed this advice. I estimate I lost roughly $1 million over my career, although that is a story for another day. And just ask the millions of American’s who have lost their entire life savings over the past couple of years if they wish they had ignored the “boom” and just hunkered down?