Tuesday, June 5, 2012

How to Get Rich - Convert Savings to Income ( Part Three )

At this point you should be well on your way to building your income producing portfolio.

Hopefully, you have been able to find a few good quality investments that you can be comfortable with.

If not, don't worry. It may be that the time is just not right to take action. Don't be afraid to keep building your cash (in your money market fund ) until the time is right or you become more comfortable with the process.

Don't Feel Rushed

You should never put yourself in a position where you feel rushed to make an investment decision. Take the time you need to learn about a particular investment and/or about the whole investment process. Once you become more comfortable and with a little experience, you will find that your decisions can be made much faster.

Remember, your investment time horizon is the rest of your life. There is no rush to do anything until you fully understand.

Review, Review, Review 

Once you make investment purchases it does not mean you just forget about them. It is true that they will virtually run on their own and pay out income to you month after month. However, they must still be constantly monitored to ensure the income remains steady and there are no income cuts planned in the future. Read their financial reports and make it a point to truly understand what you are reading.

It is also wise to constantly check their market position through sites such as bigcharts (see links page) to ensure the value of your investments remain in line with your expectations. In life, things are constantly changing and you must keep up to date with the issues that may effect the value of your investments.

Keep Your Mind Open 

Even when you are fully invested, it is wise to keep searching for other opportunities to invest in. For instance, you may find that a new investment you are looking into has more income or has a better future outlook than one of your current choices. If this is the case don't be afraid to sell your current investment and purchase the new one.

There is no such thing as an investment that is good forever. As times change and your current financial position changes, so should your portfolio. You must keep up to date with current trends and choose the right investments that will help you capitalize on those trends.

To achieve true wealth, you must stay on top of your game so to speak. Don't get so comfortable with what you are doing to the point where you no longer look for new options. Many investors who do this will be left behind when the next change happens. These changes can happen any time and usually when least expected.

Be prepared for change. It is inevitable.

As always, I welcome your comments and suggestions for future topics.

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