Making the first step in anything you do can be a little overwhelming and downright scary. The added pressure of digging into your money that has been stored away safe from harm adds to the level of stress that you can feel. There are basic steps that you can use to help you conquer the entrance into making investments for the first time. Before you begin any investments, you should be comfortable with knowing that there are risks in anything you do in life. It is the smart decisions you make that reduce or eliminate the risks involved in investing.
Your First Step as an Investor
While it might be tempting to start writing checks or transferring money, you should first determine if you have any liabilities that could interfere with your investment strategies. This can include outstanding debts, mortgages, college tuition, car payments, lawsuits, medical problems or disabilities. All of these instances can easily remove portions of your available income that you use to make investments. Totaling up your debt and removing it from your available income is the first step to make as an investor.
Know Your Current Tax Rate
Investing is actually an easy process and you can make a lot of money. The one thing that you should be aware about is the tax rate that you pay on any earned income. Your personal tax rate could grow higher as you gain more income. It is helpful to review the IRS tax code for your income level and your expected income level to make sure that you do not end up paying too little or too many taxes tax each year. The last thing that you want to have happen is to pay extra taxes and penalty fees with your profits from investing.
Research How You Will Invest
It does not cost you money to review the various investments that are available before you start to spend your money. It is likely that you have already tried low risk investments like certificates of deposit or money market accounts that return small interest rates. Playing the stock market is a gamble that you might not be ready for during the early stages of your investing career. You can research investments with high returns to maximize your profit potential to recoup your investment quickly.
Investments with High Interest Returns:
• Rental Properties
• Gold and Silver
• Payday Loans
• Receivables Factoring
• Oil and Gas
Knowing where to put your money for long-term growth is important. Some high interest investments begin with a high rate and slow down considerably in later years and can lose money. The real estate rental property market continues to grow annually and offers instant cash profits each month. The purchase of a real estate property can be made in full or in part with a group of investors to decrease the initial investment amount required to start. By placing your money in proven markets, you can build your wealth at a steady pace and eliminate losses.