Investments: Where to Start?

by Rose Wolkins 02/21/2021

Photo by 3D Animation Production Company via Pixabay

Have you received your 401K packet? It probably had some selections to make, such as a list of investment options to choose from. A small choice like this makes a big difference down the road. Whether you own a 401K, need to fund your own retirement, are putting a down payment on a home, or have some money left to you by a relative, there are some basic investment principles.

Stocks Are Still Your Best Bet

Every decade or two, the stock market tanks, everyone panics and some people say stocks are just a gamble. And if you get excited and buy in heavily while the Dow is nearing its peak, you will have a problem when the inevitable downturn comes. But consider this: since 1957, when the S&P 500 (an index of the top 500 stocks, a more accurate all-around market measure than the Dow) was established, its issues have returned around 9 percent a year. That’s despite a decade-long slump in the 70’s, the dot.com bust of 2000, and the “Great Recession” that started in 2008. If you’re in the market for another 20, 30 or 40 years, these setbacks are merely a dip in your long-term, upward progression.

Some other pointers:

  • Dollar cost average by buying small amounts regularly over time. If you’re in a 401K, this is automatically done for you. Don’t “buy high” by jumping on board when the market’s hot.

  • If you have a 401K, try to make the maximum contribution. If your employer matches, you’re turning down free money if you don’t.

  • Don’t get excited about what’s hot today. When stocks are low, some people say gold is a no-lose choice. It’s not. It will come down. In the late 90s, day traders were bragging constantly about their latest coup, investing in startups that had never made money and never would. It came to a screaming halt in 2000. 

  • Be careful of picking individual stocks. Few people beat the market average. Even professionals who manage funds don’t do well. Favor index funds. An S&P 500 index fund buys every stock in the S&P 500. It doesn't try to outguess the market. 

  • Financial advisers may come to you suggesting their favored investment. Be leery of anyone who presents a solution before understanding your situation.

Stick to a sound, steady plan and don’t get rattled by the noise around you, and you can build a comfortable nest egg over a lifetime.

About the Author
Author

Rose Wolkins

REALTOR® Rose Wolkins has been building a long list of satisfied San Diego home buyers and sellers since she began her real estate career in 1988.

Her motto “Building lifelong relationships one home at a time” exemplifies both her attitude and the care and commitment with which she serves each client. It all begins with communication – in listening well, being readily available to answer questions, and keeping clients fully informed throughout their transactions. She’s also known for staying one step ahead of things, so she can keep transactions on track and address issues before they become problems.

Always striving to do the best for her clients, Rose stays current with changes in laws and technology through taking numerous classes throughout the year. She also stays current with the ever-changing San Diego housing market.

While she thoroughly enjoys using her advertising, photography, staging, marketing, and negotiating skills to successfully sell her listings, her favorite part of the business is handing overjoyed buyers the keys to their new home. She loves sharing the joy.

In addition to supporting her clients, Rose supports the real estate industry and was voted chairperson for the North County Real Estate District Coordinating Committee several years in a row. Voted a 5 Star Top Real Estate Agent for the past several years and now again in 2020, she’s also a member of the Women’s Council of Realtors.

In her free time, Rose enjoys reading, gardening, exercising, using her considerable photography skills, and spending quality time with friends and family. When you’re looking for a San Diego agent who knows the territory well and who will dedicate herself to turning your real estate goals in to reality, take this advice from her past clients: “Call Rose Wolkins.”