Top 5 Mistakes Every Investor Should Avoid in 2013 | Miki's Hope

Top 5 Mistakes Every Investor Should Avoid in 2013

Wednesday, March 6, 2013

Each new year brings new investment challenges for anyone who has money tied up in the markets. Whether you are anxiously watching the progress of your retirement program or you make your living by playing the stocks, there are tips you will all need to heed as 2013 gets rolling.

Living Off Interest

Interest

Image via Flickr by 401 (K) 2013

Back in the 1980's and 1990's, interest rates were high and dividends were even higher. But as 2013 approaches, investment experts are warning that the practice of living off of interest income or dividends is a bad idea. The Federal Reserve has interest rates down to almost nothing, and even the most blue chip companies are not posting significant dividends. Investors will have to find a new way to supplement their income in 2013.

Working Against The Market

Retirement

Image via Flickr by roger4336

These days, the stock market is posting record numbers, but people are still struggling to meet their financial goals. Investment experts recommend that people stop trying to guess where the market will go and work with the market to meet their needs. You need to establish what your goals are and then invest wisely to achieve them. If you want to retire early, then start looking at realistic investment vehicles you can use to make that happen gradually as opposed to trying to get ahead of the market and make your money all at once.
Panicking at Every Economic Headline

Panic

Image via Flickr by Thomas R. Koll

With the financial condition the world seems to be in, it can be very easy for investors to panic with every new economic headline. The best approach is to analyze those headlines and try to determine how, or if, they affect your financial situation. If the news does not affect you, then do not react to it.

Avoiding Diversification

Diversity

Image via Flickr by University of the Fraser Valley

When the Great Recession started in 2008, investors began to look for safe investments that would prevent the financial bleeding. Unfortunately, many of those investors still hold on to a very narrow portfolio that exposes them to risk should the market collapse again. What investors need to do is get the office address for Fisher Investments and sit down with a financial professional to discuss diversifying their portfolio. The financial climate is just as unstable as it ever was and keeping your money locked up in a small group of investments is dangerous.

Reacting To Government Instability


Government spending

Image via Flickr by 401 (K) 2013

Every investor remembers the "fiscal cliff" that the world avoided to start off 2013. That was just one entry in what looks to be a long list of economic problems that the world will face as 2013 moves along. The worst thing an investor can do is change his strategy every time the government has an economic crisis. If you develop a strong and diverse investing plan, it should be able to withstand the problems we are experiencing. Don't start jumping every time the government goes into an emergency session.

These are trying economic times and they can make any investor rethink his strategy. As 2013 starts to pick up steam, it is important for investors to understand the challenges ahead and how they should react to them. A smart investor is one who is prepared for anything.





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6 comments :

Mama to 4 said...

great tips, SO glad my husband does all his homework before making investments for our family. It could be scary!

Journeys of The Zoo said...

My husband is self employed and I'm a SAHM so we really need to be aware of our finances and we can't do it alone. Thanks for the reminder and tips.


Besos, Sarah
Zookeeper at Journeys of The Zoo
journeysofthezoo at hotmail dot com

Kelly R said...

These are wonderful tips. Thank you for sharing them.

Christy Maurer said...

I'm afraid we are coming to a time when investing will be a thing of the past! Unless this economy has an upturn people are living paycheck to paycheck.

Alaina Bullock said...

These are some great tips, and definitely things I need to keep in mind as my husband and I have been discussing this!

United States said...

thanks for sharing these great tips...

 
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