May 18, 2009 | By: Laurie Campbell

Investing 101. No question is too dumb.


I know there is always a lot of hype about investing, especially today. Where to invest, how to invest - I find it daunting myself. But I am reminded of what Warren Buffett, the most successful investor in history, once said:


"I don't look to jump over seven-foot bars; I look around for one-foot bars that I can step over."


There is one thing you can be sure of about investing, before you look for opportunities- - get rid of your debt. I don't think there is better advice than that. It's based on some 43 years of experience we have at Credit Canada,, where we provide counselling and comfort to those who are struggling with debt and trying to manage their money intelligently.


Now, I am not talking about mortgage debt. Let's face it that is usually a long-term process. I am talking about high interest debt such as credit cards. If you have covered off your credit card debt, then I believe it could be a good idea to invest. But investments are often risky, and if you can't afford to lose, you can't afford to play the game. Put it this way, you can't afford to take on risky investments anyway.


So if you are ready to play, you need to learn the rules.


Rule #1:  Understand the basics. This means knowing the terminology, knowing the pros and cons and knowing the degree to which you can smartly invest - otherwise known as your risk tolerance.


Rule #2:  Get yourself a financial planner you are comfortable with. This means shopping around. You want someone you are comfortable with so that when you ask what you think could be a potentially stupid question, you do not feel embarrassed. Don't be shy about asking any question, it is your money.  If you are looking for a financial planner, check out the Financial Planners Standards Council.


Rule #3:  Be patient. This is hard for all of us, me included. But again, we might look to Warren Buffett for some wisdom; investing is a long game and you need to go through the ups and downs of the markets and hang in for the long haul.


The most important thing to remember is to educate yourself, and not be afraid to learn everything you can from your financial planner. No question is too dumb.



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