Have you ever thought about investing your money and having it work for you? If you answered no, you should really look into investing your money. The reason being, it makes money for you! You don’t even have to do anything besides putting money towards a product or business and then that money makes even more money. There are many investing strategies out there and there are many very smart investors that have good advice for beginner investors. Some of those very smart investors are Suze Orman, Dave Ramsey, Jim Cramer, and Warren Buffet. All of these investors advise you to start investing early. The money you make from this will help you throughout your whole life.
The first investor, Suze Orman, has three tips in her plan. The first tip states that diversification is key, “you don’t want to buy just one individual stock because if that individual stock happens to go down there goes all your money,” (Lewitinn). Therefore meaning that you need to invest in many different products or businesses with your money and not just one. Her second tip states that dollar cost averaging is the key to success, “you’ll never buy at the lowest point and you’ll never sell at the highest. But, what you will do to be a winner is to do dollar cost averaging,” (Lewitinn). Which means that you need to decide on a specific dollar amount to invest each month so that when the market is up your money will buy less shares and when the market is down your money will buy more shares. The third tip is that you need to start early and start right, “the sooner you can start investing, the better you are… time is the most important ingredient in any financial freedom recipe” (Lewitinn). Meaning that time will determine how much money you will make in the long run, which is why it is important to start investing early.
The second investor, Dave Ramsey, has seven steps in his plan. The steps are to save a $1,000 starter emergency fund, to pay off all non-mortgage debt, save three to six months of expenses for a fully funded emergency fund, invests 15% of household income in retirement accounts, save for your kids’ college, pay off your home early, and build wealth and give. Dave recommends investing in mutual funds and spreading our investment among many companies helps you avoid the risks that come with investing in single stocks. Mutual funds enable you to invest in many companies at once, from the largest and most stable, to the new and fast-growing. They have teams of managers who choose companies for the fund to invest in, based on the fund type.
The third investor, Jim Cramer, also has three tips to his plan. The first tip is to invest your savings, “Cramer thinks the stock market is a great way to trick investors into saving money they might otherwise spend” (Stevenson). Which is saying that it is important to save your money because the returns are usually very small, but if you save them over time it can become a big help for you in the future. His second tip is to take risks if you are young, “Younger investors can afford to take more risk” (Stevenson). This is saying that if you make a mistake when you are twenty it is not that big of a deal because you still have the rest of your life to fix and makeup for that mistake. The third and final tip is it is never too early to save for retirement, “start investing for retirement, especially if your job has an option for a 401(k), and contribute to a Roth IRA,” (Stevenson). This explains that if you start saving now for your retirement then you won’t have to worry about the shackles of a paycheck.
Now that I have read about these investors my plan will contain five steps. Step number one of my plan will be to first save up money to use to invest. My second step will be to invest that money in several different companies and/or products. Because as I learned from Suze Orman, diversification is key and if you only invest in one product or business and it crashes then all your money is gone. My third step will be to invest early and often. I’m going to get my money to work for me so that I can use the money for my next two steps. My fourth step will be to save the money from my investments to pay for my kids’ college. My final step will be to save for my retirement so that I won’t have to work after I am retired, not even part time. I won’t have to worry about money or stress about how to pay my bills.
This essay was written about how I would plan to invest my money when I am older and maybe very soon. It taught me that there are many ways that you could invest and that investing is very important. This essay helped me create a plan that I will use in my future to make money and to not depend on social security or money from the government that I can't depend on to be there.
The first investor, Suze Orman, has three tips in her plan. The first tip states that diversification is key, “you don’t want to buy just one individual stock because if that individual stock happens to go down there goes all your money,” (Lewitinn). Therefore meaning that you need to invest in many different products or businesses with your money and not just one. Her second tip states that dollar cost averaging is the key to success, “you’ll never buy at the lowest point and you’ll never sell at the highest. But, what you will do to be a winner is to do dollar cost averaging,” (Lewitinn). Which means that you need to decide on a specific dollar amount to invest each month so that when the market is up your money will buy less shares and when the market is down your money will buy more shares. The third tip is that you need to start early and start right, “the sooner you can start investing, the better you are… time is the most important ingredient in any financial freedom recipe” (Lewitinn). Meaning that time will determine how much money you will make in the long run, which is why it is important to start investing early.
The second investor, Dave Ramsey, has seven steps in his plan. The steps are to save a $1,000 starter emergency fund, to pay off all non-mortgage debt, save three to six months of expenses for a fully funded emergency fund, invests 15% of household income in retirement accounts, save for your kids’ college, pay off your home early, and build wealth and give. Dave recommends investing in mutual funds and spreading our investment among many companies helps you avoid the risks that come with investing in single stocks. Mutual funds enable you to invest in many companies at once, from the largest and most stable, to the new and fast-growing. They have teams of managers who choose companies for the fund to invest in, based on the fund type.
The third investor, Jim Cramer, also has three tips to his plan. The first tip is to invest your savings, “Cramer thinks the stock market is a great way to trick investors into saving money they might otherwise spend” (Stevenson). Which is saying that it is important to save your money because the returns are usually very small, but if you save them over time it can become a big help for you in the future. His second tip is to take risks if you are young, “Younger investors can afford to take more risk” (Stevenson). This is saying that if you make a mistake when you are twenty it is not that big of a deal because you still have the rest of your life to fix and makeup for that mistake. The third and final tip is it is never too early to save for retirement, “start investing for retirement, especially if your job has an option for a 401(k), and contribute to a Roth IRA,” (Stevenson). This explains that if you start saving now for your retirement then you won’t have to worry about the shackles of a paycheck.
Now that I have read about these investors my plan will contain five steps. Step number one of my plan will be to first save up money to use to invest. My second step will be to invest that money in several different companies and/or products. Because as I learned from Suze Orman, diversification is key and if you only invest in one product or business and it crashes then all your money is gone. My third step will be to invest early and often. I’m going to get my money to work for me so that I can use the money for my next two steps. My fourth step will be to save the money from my investments to pay for my kids’ college. My final step will be to save for my retirement so that I won’t have to work after I am retired, not even part time. I won’t have to worry about money or stress about how to pay my bills.
This essay was written about how I would plan to invest my money when I am older and maybe very soon. It taught me that there are many ways that you could invest and that investing is very important. This essay helped me create a plan that I will use in my future to make money and to not depend on social security or money from the government that I can't depend on to be there.