by Kodjo Adadevoh

Created on: March 07, 2010

The reasons to invest should be obvious. Investments are part of our goal setting process and help us achieve our goals, be it a kids’ college education, retirement, the purchase of a home or any other major financial outlay. 

There are a myriad of investment vehicles for accomplishing whatever financial goals we set for ourselves. The most significant challenge to our plans is inflation. Inflation is simply the rise in the prices of goods and services that we consume. If we could buy a hamburger for $1.00 in January 1990, a year later, in January 1991 the same burger may cost $1.10. If we kept our $1.00 under out pillow and did not invest or put it to work for us, then our dollar would have lost value and we would have lost purchasing power and will not be able to purchase the same burger that we could purchase a year earlier. 

Most people have 30 to 40 productive years in which they will earn the most amount of money that they can. These are the years in which we all lay the groundwork for our years in retirement. If we invest well and judiciously, our retirement years will be fulfilling and pain free, if however we do not appropriately prepare for our old age, we will wallow away in self pity and misery as all of the things we need elude us. Our investment plans have to not only outpace the rate of inflation but must also provide a satisfactory level of income when we can no longer earn the level of income we once could by working at a job.    

College education is a significant challenge for most families, with state colleges costing approximately $20,000 per annum with room and board. Without appropriate planning, most families will not be able to save enough to afford to pay for their daughter or sons college education. Imagine the burden if one happens to have more than one child and if their investment goals and plans are inadequate, then the only option they will be left with, that is, assuming their child gets not scholarships is to laden their child with student loans. 

Investments form the cornerstone of our ability to achieve our goals and aspirations. Without investments it is impossible to plan for anything in the future. Savings accounts, money market and Certificate of Deposits (CD) are undoubtedly a first step for most investors. These investments are secure and insured by the Federal Deposit Insurance Corporation up to $250,000 per account. These investments are particularly important for people in

• 1
• 2
• Next Page >>