Getting Started

Three months ago, I was just like you. I didn't know much about Stocks, Bonds, Mutual Funds, 401k's, IRA's, or any other financial topic. I decided to change that and here is how you can to.

Learning about Investing is not very difficult, it just takes time and patience. You will need to start small. I recommend reading some business related articles that you can easily find in the newspaper or any News website. By reading a few articles you will see that you are introduced to some new words and acronyms. Your not going to know what these mean, don't worry, soon enough you will know exactly what those terms mean. An easy way to find out what those mysterious terms such as ROI, NAV, and P/E Ratio mean is to go a neat website called Investopedia.com. Investopedia is what it sounds like, it's a encyclopedia for Financial and Investment terms.

You might be wondering what's next ? Well, you need to ask yourself why you want to invest and what do you hope to accomplish. It's a hard question to answer if you really think about it. People invest for different reasons and those reasons change as you progress through life. Some invest to build wealth, some invest for their retirement, and some just want to buy something really expensive so they throw their money into a mutual fund for a few years and hope they get a better return than the bank can provide.

If you know why you want to invest, the next step is a lot easier.

Educate yourself in Personal Finance

Finance; it's a scary term for some, but believe me its an important part of your life if you believe it or not. You already manage your Personal Finances and most of you don't even know it. If you have a bank account, credit card or even just a paycheck, you manage your finances. Now the hard part is finding out how to make your finances work for you.

Before you can do that you will need to educate yourself. Go to your local bookstore or to one of the online bookstores and go to the Personal Finance section. Look for a book on Personal Finance or Personal Investing. Crack it open, look at the table of contents and you will see that most of them have the same information. Most of these beginner books start off slow and progress to a more complicated list of topic's. You can easily start with Personal Finance For Dummies.

The goal is to familiarize yourself with the basics of Finance and Investments. As you progress you will know if you want to concentrate on Stock's, Mutual Funds or Retirement Accounts. There are great books for each one of those topics. I highly recommend MorningStar Guide to Mutual Funds if you are interested in Mutual funds. It is a very informative book. After reading it, I felt comfortable enough to purchase 3 funds which helped me to diversify my portfolio.