Investment Tips - What Not to Do

Before you start investing, read these top tips of what *not* to do along the way...

Bad Tip #1 ~ Respond to unsolicited 'hot tips'.

Yippee!! A stranger emailed me a great stock tip. The email says I should buy a bunch of this stock today, and then I'll have enough money to retire this month!

Reality: This is an email looking for suckers. Don't be one of the suckers! Ignore emails, (and faxes, and phone calls, and regular mail), claiming to give you the latest inside scoop. It's a hoax. Don't respond to solicitations from strangers. When you're ready to start investing, contact am established, reputable firm.

Bad Tip #2 ~ Invest somewhere that promises to double your money.

The discount broker I met at the ball game says I should bring him a check on Monday and he'll help me double my money by my birthday. He says it's guaranteed! I'm so lucky I ran into him.

Reality: No, you're not lucky! He's the lucky one, because he just found himself a sucker. No one can guarantee you'll do well in the stock market. Anyone who makes promises like this either doesn't know what he's doing, or is trying to scam you.

Bad Tip #3 ~ Rush into decisions.

I think I found a really good investment, but the opportunity is only good for today. I'm not really comfortable having to decide without doing any research, but I don't want to miss out. I'd better go to the bank on my lunch break, so I can withdraw the money and invest today.

Reality: It is ALWAYS wise to take the time to do your homework before investing. Be very suspicious of 'limited time' offers. If someone's trying to pressure you into a quick decision, it's very likely to be because they know that if you took the time to investigate you'd find something to convince you not to part with your hard-earned cash.

Bad Tip #4 ~ Don't worry about getting anything in writing.

I can remember everything the broker said today. And I probably won't to 'prove' anything he said, because I'm sure he won't try to change the terms of the deal on me. I'm a trusting person.