Section II - Lesson 7
Investing Basics - Summary And Review
The following is a summary of the major points presented in this section about the basic principles of investing your money and building wealth.
1) The secret to wealth is to pay yourself first - automatically - and right off the top.
2) Saving 12% of all you earn is good enough to make you wealthy.
3) Begin as soon as possible, because early money earns the most.
4) For maximum returns you must invest in a widely diversified stock fund such as an S&P 500 Index fund.
5) In a long-term investment program, time, diversification, and the timing technique of dollar cost averaging serve to minimize the risk of owning common stock to the point of non-existence.
6) In a long-term investment program, your real risk is inflation, which is minimized by owning common stocks.
7) Risk is to be managed, not avoided.
8) Emotional issues will shake you to the bone, and must be managed.
Recommended Reading
For more complete guidance and advice about the basic principles of building wealth, you should check out our classic textbook, Financial Independence 101, A Simple Strategy For Building Wealth, on which this course is based.
The book is now being offered in hardcover at the special price of $19.95 with free shipping (you save $9). It is also available for immediate download in PDF format at only $9.95. Check it out!
Do you know others who would enjoy and benefit from this course? Pass the word along. It's free. And we will never violate your privacy!
A Publication of About Your 401k.com
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