Courtney Myers Blog | Four Money Management Tips for First-Time Investors | Talkmarkets

Four Money Management Tips for First-Time Investors

Date: Tuesday, September 25, 2018 6:10 PM EDT

If you’ve been considering investing in the stock market or creating a retirement portfolio for yourself, your first course of action may have been to seek out a financial planner to help you navigate the ropes. This is a great step, as these professionals are highly trained and experienced in this niche and can offer insight and expertise to help you make the right decisions. However, before you even schedule that appointment, there are simple steps you can take right now, as an individual investor, to help you better manage your money, make sound choices and lay the groundwork for a fruitful investment.

While it is in your best interest to seek counsel and guidance where you can get it, these four tips can help you get your financial feet wet before you jump all in. Let’s get started.

1. Keep a long-term perspective.

Especially for beginner investors, it can be tempting to throw all of your money at the most popular or well-performing stock on the market. After all, if so many people are going this route, you should too, right? Not so fast. Consider instead why you’re investing in the first place. Chances are, you are looking for steady, long-term savings that will build over time.

To this end, flash-in-the-pan stocks might look favorable in the current environment, but until they build up a successful performance history or prove they have the infrastructure to deliver on their promises, it’s wisest to stick with tried-and-true performers. Keeping your eye on the prize, even if it’s decades away, can help you ensure that over time, your ROI will be at the level you require. In the same vein, resist the urge to jump ship just because a particular stock is having an “off” month or even year. Remember, though the market does ebb and flow, it usually trends upward, so stick with it and maintain a future-focused perspective.

2. Remember to budget.

As you seek to make contributions toward your retirement account, it’s important to do so only if you truly understand where your money is going each month. Otherwise, you could be investing funds that need to be set aside for your mortgage or utility bill instead. To help you understand how you’re spending and where you could be saving, keep a monthly budget that tracks and categorizes all of your income and expenses.

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