by Art West

Created on: November 24, 2010

If you are looking to invest some of your money, Mutual Funds are an excellent investment.

Now come the tough part.  There are thousands of Mutual Funds, so how do you decide which ones to invest in?

If you are new to investing, lazy or have trouble understanding investing, I suggest that you find a financial adviser.  This can either be a CPA or you can go to a brokerage company like Raymond James, Edward Jones or Charles Schwab to name a few.  No matter where you go for guidance there be sure that who ever you are dealing with is willing to take the time to explain your invest so that you can understand it.  If they simply say "just trust me" get away from them as quickly as possible.  You also need to be somewhat prepared as you look for your adviser.  You should have a rough idea of what types of funds you want to invest in.  There are basically 3 types of funds to invest in.  Balanced, Foreign and Growth.  There are other types, but these are the very basic ones and the ones that I am going to deal with in this article.

A Balanced Fund is a fund that is fairly well balanced in their investments between stocks and bonds.  In most cases you can expect a Balanced Fund to have between 60-70% in stocks and 30-40% in bonds.

A Foreign Fund is a fund that has most, if not all of it's investments in foreign countries.  You can find funds with names like EuroPacific Fund, World Growth Fund or Asian Fund.

A Growth Fund is exactly what it sounds like.  A fund that is focused on growth.  There are Small Growth Funds which focus on investing in small businesses.  These funds are more risky.  You can make more money investing in them, but you can also loose more money. Then there are Mid Cap Growth Funds, which invest in mid sized businesses and finally your Large Growth Funds which invest in large businesses like Coca-Cola or IBM.

You should invest in each of these categories so you will be more diversified.  If the market in the U. S. is struggling, Europe may be doing well.  If Europe is struggling, the Growth Funds in the U. S. should help you.  I realize not everyone will have enough money to invest in all of these funds.  My suggestion is to begin with a Balanced Fund.

You also want to be sure to invest in funds that have been around a while.  The longer a fund has been around, the better.  For example, a fund that began in 1934 and is still around would have

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