A Financial Leadership Conference
Raising the Standards for Active Financial Leadership

Where to Start: Better Investing 

Better Practices & Better Information

Better investing is not about finding a guaranteed investment. There’s no such thing. It’s about understanding and managing risk. And it’s about working with a set of standards that will protect you from careless practices.  

Selecting an Advisor You Can Trust

Investing requires trust. If you don’t trust the advisor you’re working with, you can’t trust the information they are giving you. So as you look for the right retirement fund to select or what investment opportunities you should pursue, the right investment manager will make all the difference. 

Saving

Investment managers and financial advisors agree on the necessity of saving. While the methods of saving vary (like high-yield savings accounts and IRAs for instance), any kind of saving sets you up for success, even a small amount each month. The discipline of deferring a purchase today to gain rewards tomorrow is a first step to good investing. Good investors are always good savers. 

Diversifying

There are strategies to determining how a diversified portfolio should look.

What percentage of my assets is invested in liquid assets and how much is in non-liquid assets? 

Stocks, bonds, and money funds are liquid; your home is illiquid. This is important because liquid assets can be converted to cash quickly and cheaply. Illiquid assets take a while and can be costly to sell. When you consider where you want to invest your money, you must take this into consideration.

What percentage is invested in common stocks (growth) and what percentage is invested in bonds (income)? 

For most investors, a mix of 60% in stocks and 40% in bonds is about right. 

How many stocks do you own in total in your mutual funds? 

This will usually require some work by your financial advisor. Since many mutual funds own 200 stocks or more, if you own 10 mutual funds you may own 1500 or more stocks. This many stocks looks like an index fund.