In 2010, each year thousands of high school graduates are graduating college bragging about the major, major or minor that experts classify as a university, trade oratives. At the end of 4 years, graduates will be qualified to get the first long-term mortgage loan product through conventional mortgages.
After college, many graduates want to obtain higher education, so they start working. Their paychecks begin to dry up and financial security tops their list of priorities. For the sometime rich they cash in their savings and invest in the stock market. They think about investing in stocks, real estate or other investments. In this situation, their income is one of the most important factors in getting the first long-term mortgage loans. There seems to be a specific reason why. It could be a wake up call to people who don't understand how to manage their finances in the 21st century.
Before investing in that new car, you need to develop an investment plan. Thousands of people grab the first start up strategy book, read to much about mutual funds and attempt to enroll in a new high school class where the teacher makes fun of their aging parents. What happens is that the investor is so excited by the ideas of the "investment professionals" that they just remember all about the Smoot diet. After the class, the person quits. They just forget about investing. They continue to b newsletter or watch CNBC.
Investors have made incredible progress over the last four decades or so from the beginning of the Great Depression in 1929, where their assets would lose 40% of their value within 90 days. The past is painful, but the future is bright because they have learned to manage without speculation. In the last four decades, many have invested with a strategy of buying low and holding onto it until it takes off and starts going up. A great many investors still have long-term investments that are producing income and keep going. Their dreams of early retirement have become a reality and been made real amidst the worst economic recession since the Great Depression.How do they do that?
An investor's investment plan should be designed to maximize your growth. Equity markets and long term assets are prime examples of asset classes that have no time requirements and can be tapped into relatively readily. The secret to managing your money the right way is by diversifying your investments in those assets that are already producing a stable or growing income such as bonds and money markets. Holding onto your investments until the tide turns is a risky and imprudent way for a investor to do it. It's smarter and faster to find multiple streams of income and to invest those streams properly so that you can retire early with enough money in your pocket.
There are many advantages of long term investments.
1. The rates of return on your investments are greater than any short term investments that you can make.2. Diversifying your investments makes it less vulnerable to market fluctuations.3. You will have the cash flow to fund your living expenses and current investments until you take advantage of the multiple investment strategy.4. You will be able to invest a portion of your wage for retirement so that you have the flexibility to do what you want.
Investing is a skill and if you learn to do it well, learn it quickly. Successful investing strategies will make you sick with envy. Delaying the gratification of your investment returns is how you become rich. You can sit back and complain about the levels of financial school grades that you have yet to acquire, or you can take charge and take the bull by the horns and take your financial future into your own hands.