FIVE TIPS FOR SUCCESSFUL INVESTMENT

1. START YOUNG & INVEST FOR LONG TERM
When you start investing at a young age, you can take more risk and invest on a fund that can generate more return and also because time are on your side it means you can maximize the power of compound effect on your investment. Long term investment is the best investment. Ask Warren Buffet if you don’t believe me .The phrase time is gold is truly a reality for young and long term investor.

2. INVEST REGULARLY
Discipline yourself to invest a certain amount of money regularly so that you can apply the Dollar cost averaging to minimize your risk and also slowly build up your investment capital. The easiest way is by changing your mind set by treating your investment as a compulsory monthly payment just like all your utility bills.

3. USE ONLY EXTRA MONEY
Invest only with your extra money and never use your emergency saving to invest because you never know when you might need the money. Since an investment usually need times to grow and give you a handsome return it is better to use only extra money so that you don’t need to worry when there is an emergency.

4. DIVERSIFY YOUR INVESTMENT
Have you ever heard of the phrase “Don’t put all the eggs on one basket”?
What the phrase means is that it is better to put all the eggs on several baskets so that if one basket of eggs falls you still have eggs on the other basket. This means you have reduced the risk of loosing all the eggs. Same strategy can be applied on your investment. Invest on several different types and risk of investment to reduce your risk. Diversification will surely make your less depress when the market is bearish (down trend) and also help you to get a good night sleep.

5. DON’T PROCRASTINATE YOUR INVESTMENT
Procrastinating (delaying) your investment will surely guarantee you loss an opportunity to make money. When it comes to investment time does play a magic role on your return. Albert Einstein once said the power of compound is the eight wonder of the world. Example if you are 25 years old and invest a lump sum of RM 10 000 now at an annual return of 8% a year, it will be come RM 100 626.57 when you reach 55. If you decide to procrastinate your investment by 5 years and only start to invest when you are 30 years old. The return will be RM 68 484.75 when you reach 55 years old. This mean you have already lost a chance to make an extra RM 32 141.82.

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