The concept of investing and saving is something that should be developed early. My mother forced me to open up a savings account once I got my first job at age 15, and I assume most of you are in the same boat, but she was right. The earlier you start, the more you will have in the end. Time is on your side because of the power of compounding. However, people often forget about retirement because it seems so far away, and this could pose problems in the future. Over half of Canadians and Americans do not have a retirement plan and maybe even worse, have not saved enough for retirement. In fact, some believe winning the lottery is one.
In my first year of college, my investments professor made me realize how important it was to save every extra penny. He presented us with a typical financial math question, and we inputted the data into our newly-found financial calculators. At the time, I had no idea how to use it, but the resulting sum was over one million dollars. We were all amazed how little it took to earn a million dollars, only to realize it was over forty years of saving. Disappointment ensued, until my professor asked, "When else will you need one million dollars?" - immediately answering his own question with, "When you have no income."
He was dead on. For the majority of us, it takes a lot of hard work and a lot of time to build up such wealth, but you're building the wealth for a great retirement. There's nothing wrong with enjoying your life early on, and I don't want to stop you at all. Life is for living, but these next few lessons are here to help guide you with ways to enjoy it today and tomorrow, without making sacrifices.
Before I provide you with my opinions on investments, let it be known that I have worked in the financial services industry for almost three years, dealing with million dollar accounts, CEOs of major multi-national corporations, and even the little guy. I am currently on hiatus, taking time off, actively trading in the equity and options market, but plan to re-start my career with investments very shortly.
In the next few chapters of this series titled, "The Bare Necessities", I will discuss the strategies used by financial and investment advisors to build a well-balanced long-term portfolio, as well as fully explain the typical vehicles and products seen in the market. This is targeted for buy-and-hold investors looking to safely park wealth and allow it to grow with little concerns. In a future series, I can discuss the basics of day and position trading through the explanation of basic technical analysis.
The Bare Necessities: Prologue
The concept of investing and saving is something that should be developed early. My mother forced me to open up a savings account once I got my first job at age 15, and I assume most of you are in the same boat, but she was right. The earlier you start, the more you will have in the end. Time is on your side because of the power of compounding. However, people often forget about retirement because it seems so far away, and this could pose problems in the future. Over half of Canadians and Americans do not have a retirement plan and maybe even worse, have not saved enough for retirement. In fact, some believe winning the lottery is one.
In my first year of college, my investments professor made me realize how important it was to save every extra penny. He presented us with a typical financial math question, and we inputted the data into our newly-found financial calculators. At the time, I had no idea how to use it, but the resulting sum was over one million dollars. We were all amazed how little it took to earn a million dollars, only to realize it was over forty years of saving. Disappointment ensued, until my professor asked, "When else will you need one million dollars?" - immediately answering his own question with, "When you have no income."
He was dead on. For the majority of us, it takes a lot of hard work and a lot of time to build up such wealth, but you're building the wealth for a great retirement. There's nothing wrong with enjoying your life early on, and I don't want to stop you at all. Life is for living, but these next few lessons are here to help guide you with ways to enjoy it today and tomorrow, without making sacrifices.
Before I provide you with my opinions on investments, let it be known that I have worked in the financial services industry for almost three years, dealing with million dollar accounts, CEOs of major multi-national corporations, and even the little guy. I am currently on hiatus, taking time off, actively trading in the equity and options market, but plan to re-start my career with investments very shortly.
In the next few chapters of this series titled, "The Bare Necessities", I will discuss the strategies used by financial and investment advisors to build a well-balanced long-term portfolio, as well as fully explain the typical vehicles and products seen in the market. This is targeted for buy-and-hold investors looking to safely park wealth and allow it to grow with little concerns. In a future series, I can discuss the basics of day and position trading through the explanation of basic technical analysis.
Tuesday, February 9, 2010
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1 comment:
Gah for the longest time my savings habits included investing in an expensive item, that I could later resell (which is true, I can re-sell).
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