Before you can really start investing, following top 10 things you have to think about:Do you have enough money to invest?
I think most people in young age fail to do proper planning for their finances. For example they might go out and buy a house prematurely. I know a colleague of mine who ended up making huge losses on the condo he purchased during 2007-2008 timeframe. Since he was early in his career, he had to eat those losses and sell the house at a much cheaper rate than what he bought it at.
Ideally one should sit down and plan the finances for next 3-5 years before making any investment decisions. Do not think month to month, think medium to long term. Then start allocating small chunks of money into various investment vehicles. It can be buying a house, purchasing stocks or anything.
Stock market is a risky bet as you don’t really have anything tangible as you do when you purchase a house. Due to that reason, you should only allocate the money into the market which you don’t need anytime soon. So do you have a chunk of money which can be put into the market?
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