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5 Actions to More Successful Investing

Investing in the markets is key to the goal of gaining and maintaining wealth.  Investors, especially new investors, will oftentimes make fundamental mistakes that throw up obstacles to that goal.  These unforced errors lead to underperformance due to less money getting invested and lost opportunities.  

I believe there are some critical actions and behaviors that every investor should apply in their investment approach.  They are:

Keep expenses low: The most important thing when investing is keeping your expenses low.  This includes account fees, transaction fees, mutual fund and ETF operating expenses, and advisory fees.  You can do this on your on by using formerly discount brokers like TD Ameritrade, Fidelity, or Schwab (Bias alert, I worked for Schwab for nearly 20 years and absolutely love the company.)  I call them former discount brokers because the level of service and product line now offered by these companies matches and sometimes exceeds the older traditional firms like Merrill Lynch, Morgan Stanley, etc.  If you don’t want to do it on your own, there are plenty of good advisers out there.  Search Find a CFP® Professional

Know what you’re paying: If your current adviser can’t or won’t explain how he or she is paid and the fees you are charged, that’s a problem. You shouldn’t have to demand it, but if it’s not apparent ask for an explanation.

Be disciplined: Most individual investors and professionals cannot time the market. Why are you trying? If you are investing in the stock market, you should have a long-term time horizon. Of course, you should be invested in high quality issues, allocated appropriately, and sufficiently diversified. A well-balanced portfolio suited to your risk profile is a good prescription when the market makes you queasy.

Pay yourself:  If you work for a company with a 401k match.  It’s almost criminal if you don’t participate. It’s free money.  At a minimum, contribute up to the match.  If possible, contribute the maximum.

Make a plan: You know the old saw: Failing to plan is planning to fail.  I believe everyone should have a financial plan, whether it’s done alone online or with the help of a CERTIFIED FINANCIAL PLANNER ™ professional. 

This, of course, is not individual advice, but simply commentary and education.  If you need advice, please contact me to discuss a possible relationship.  (That’s about the extent of a “hard sell” you’ll ever see from me. 😊)

Remember: save early and save often to ensure a comfortable retirement.  If you haven’t started, start now!

Peter O'Neill