I wanted to grab a book on investing since I know nothing about investing. I go cross-eyed when I hear about hedge funds and HSA accounts. So I decided to at least get a better understanding.

I know what you’re thinking… this must have been a real page turner, every page a new adventure. Well… it was actually pretty good. Here’s some quality points:

  • Money in a savings account is wasting away. There’s better ways to expand your money:
    • Don’t get that confused with your 3 to 6 month emergency fund. You could also put this in a money market fund.
    • Bonds may be better than CDs because you can pull out of bonds without penalty. You can also purchase some bonds tax-free. Treasury bonds are a good investment
  • Undeveloped land, time shares, collectibles, and precious metals aren’t a good way to invest.
  • Stocks average an 8.3% return
  • You can’t live without taking risks. Just letting your money sit around is a mistake.
  • Over any 20 year time span, US Stock market investors have never lost money
  • If you’re saving for college for your kid, put it in a retirement fund, so it’s tax deductible. Or you can borrow against your house.
  • Stocks
    • Ignore NASDAQ
    • Hedge funds do not perform better than mutual funds
    • Only look at the P/E ratio of a stock (Stock Price per Share/Annual Earnings Per Share). Don’t base it on profits.
    • Brokerage firms cause a conflict of interest
    • If you’re holding a stock for only a few months, you’re not investing… you’re gambling. Short term traders waste a lot of time researching and a lot of money trading.
    • Try to buy stock in good-size… 100 shares at once
  • Mutual funds have a lot of advantages: costs less than trading individual securities, work with smart people, and diversification.
  • Vanguard is a good company to invest through.
  • REIT funds allow to invest in property without having to be a landowner
  • When investing in real estate, look at parks/sports/schools/crime/job market/expansions areas, etc.
  • When looking at a rental, review past Schedule E (if previously a rental)
  • May not need a realtor for buying, but definitely for selling
  • For Small Business, you don’t need to be entirely unique to be successful.
  • Don’t ever sign a standard pre-printed contract for leases for small businesses.