Investing provides an opportunity to grow your money in ways that savings accounts and CDs can’t. But investing comes with risk, and it’s important to understand how much you can tolerate before putting your hard-earned money into something more volatile than a bank account.

The first step in the process is to determine what you’re trying to accomplish with your investments, which will help you figure out what kind of investments are right for you. Do you want to generate income, focus on growth or achieve a combination of the two? What is your time horizon? Do you plan to need the funds in the next few years or are you saving for retirement? This can narrow down the options available to you and make the process of finding the right investment products easier. Read more https://www.theinvestorscentre.co.uk/

You’ll also need to decide if you want to do it yourself (DIY) or if you prefer to have a professional handle it for you. Then, you’ll need to choose an investment account or buckets for your money—which could include brokerage accounts, IRAs and Roth IRAs. Some of these investments are subject to tax rules, so you’ll need to keep that in mind when choosing which accounts to open.

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Finally, it’s time to assess your comfort level with risk—your risk tolerance Tooltip. This will let you know how aggressive a strategy you should pursue given your goals and time horizon. It’s crucial to not take on more risk than you can afford to lose, as that could lead to a panic sell and potentially lower your overall return.