Home' Trinidad and Tobago Guardian : November 1st 2015 Contents SBG6 PERSONAL FINANCE
SUNDAY BUSINESS GUARDIAN www.guardian.co.tt NOVEMBER 1 • 2015
Part 1Have you ever wondered how
the rich got their wealth and
kept it growing?
Do you dream of retiring early, or of being
able to retire at all?
Are you simply thinking about investing,
but don't know where to start?
Well firstly, you should know that investing
is not a get-rich-quick scheme. Taking control
of your personal finances will take work, and,
yes, there will be a learning curve. But the
rewards will far outweigh the required effort.
Investing is normally considered a good
way to make your money grow and create
future wealth. However, before you begin to
invest your hard earned money, you must
consider a few things such as your objectives
for investing and the level of risk that you
are willing to explore.
Ask yourself these questions:
How much risk is right for me?
Remember, higher risk means that
you may lose some or all of your
money so it is important to ask yourself "Do
I want to take the chance to make more
money if it also means I may lose money?"
or "Would I rather make less and keep my
How much am I hoping to make
by investing? This aspect deals with
the return on your investment
which can sometimes take the form of income
(interest or dividends) or capital gains or cap-
Generally, more risk is incurred if you expect
a higher return.
For how long do I plan to invest?
An investor's investment horizon
ie the total length of time that the
investor expects to hold a security or portfolio,
is primarily determined by the investor's
investment goals, including income needs
and risk tolerance.
For eg, saving for a car is a short-term goal
whereas allocating money for retirement is
a longer-term goal. Once these goals are
clearly defined, the appropriate investments
can be selected to best achieve those targets.
How easy will it be to get back
my money from an investment?
Cash is normally considered the
most liquid asset since it is normally kept in
small quantities in a purse or wallet while
larger sums are kept in a regular bank account.
The amount which is placed in a bank account
can usually be retrieved from the teller or via
In most cases, when you give up the oppor-
tunity to easily access your money, you should
obtain higher returns. However, it must be
noted that many investment options which
promise a fixed rate of return, usually lock
your money into a specified time frame.
Know yourself and understand what is
important to you. In this way, you will be
better informed to make the best choices that
are right for you.
Success depends on ensuring that your
investment strategy fits your personal char-
Even though you are trying to make money,
you come from a unique background and
have specific needs relative to another investor.
As such you may want to pay particular atten-
tion to your investment objectives and your
As Warren Buffet says: "Never invest in a
business you can't understand...Only buy
something that you'd be perfectly happy to
hold if the market shut down for 10 years."
A multimillionaire is obviously going to
have much different goals than a newly mar-
ried couple just starting out.
The millionaire, in an effort to increase his
profit, has no qualms about investing
$100,000 in real estate.
The married couple's focus is a bit more
concentrated on saving to make the down
payment for a house and every cent counts.
They won't risk losing their money in a spec-
So consider where you are in your life stage
and weigh in your costs and benefits both in
the long and short term.
Personality here refers to how much volatil-
ity you are willing to see in your investments.
Another personality trait looks at your desire
to research investments. Some people love
nothing more than digging into financial
statements and crunching numbers. To others,
the terms balance sheet, income statement
and stock analysis sound as exciting as watch-
ing paint dry.
Essentially the main thing determining
what works best for you is your ability to
take on risk.
Remember every individual's situation is
different and investors differ from one another.
What is important to note is that an invest-
ment is not the same for everyone. You must
also ensure that before purchasing any invest-
ment product, you consult with a registered
investment adviser, broker or professional.
The T&T Securities and Exchange Com-
mission is not an investment adviser nor
is it a brokerage house. This article is
intended solely to provide you with the
information you need to make sound invest-
ment decisions and to ensure that you are
familiar with and understand your rights
and responsibilities as a consumer of finan-
cial services. Before investing, educate and
To learn more, visit investucatett.com,
follow us on Facebook or call 624-2991. If
you have any questions or comments feel
free to email us at email@example.com.
T&T Securities and
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