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Investing can be a complex topic. Or you can use the KISS [keep it simple stupid] principle.
There are many forms of investing. Let us start with the basics:
Some people handle their own investments until THEY lose all their money. Some use financial advisors until THEY lose all their money. (:-)
It does not have to be that way. There is an abundance of evidence that various principles work most of the time.
Investing Method 1
Investing in a few low cost mutual funds aided by a coach, advisor, or whatever, which have a manager’s positive track record and a fund which has at least been average but preferably above the index.
Don’t believe the hype about always finding an individual with letters after his name because he will do better for you.
I have found NO evidence that the letters mean better advisors. If you have some please refer me. In my own experience, the certificates that an individual had accumulated certainly DID NOT improve my returns. All sellers of mutual funds take the same tests.
I asked someone who had a CFP if it made him any better advising his clients. He replied that it really had not and it was “more of the same” that he learned.
Investing Method 2
You have heard that 80% of mutual fund managers do NOT beat the stock market. So why bother getting one? Why not just read and invest yourself. Many day-traders do that and the various online brokerages LOVE every minute of it! Most day-traders lose money.
This CAN work if you decide the study hard and learn how to invest properly as Derek Foster, Canada’s youngest retireé could tell you. Derek retired at age 34. Most individuals do NOT have the fortitude to stick with it. Some have no interest in learning. Most people should get an investing coach of some sort
BUT make sure you UNDERSTAND EXACTLY WHAT HE WANTS YOU TO PURCHASE. If he does not explain it, then tell him if he doesn’t you are going elsewhere where they will.
DRIP [or DRP] Investors
In Canada or the U.S. there are certain DIVIDEND ARISTOCRATS as they are called. These are companies that have a long record of giving dividends and increasing them over time as well as allowing you to make OPTIONAL CASH PURCHASES after you have bought your first share of a company.
Good References for DRIP Investing
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