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"It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price." Sound advice from Warren Buffett, one of the most successful investors in history. Buffet looks for value and invests for the long term.

Invest for the long term. It's the cornerstone of future wealth and enlists time as your closest ally. Investing isn't difficult as long as you learn a few beginning basics. But before you jump into an investment program, take a close look at your budget and answer a few questions first.

If you have outstanding consumer loans or credit card balances, pay them off before you consider an investment program. Compounding is a wonderful thing, but it works in both directions. The money you are paying out in high interest loans will far exceed any returns on your investments, so get rid of the debts first.

Begin your investing modestly by opening a money market account or a high rate savings account. You'll be looking for interest in the four to five percent range. These accounts will give you the liquidity you need to get to your money in a hurry when you need it. It's prudent to set up a cash reserve or emergency fund to cover three to six months of living expenses. You'll be getting a good start on your investment career while building a cash cushion for situations that pop up when you least expect.

Sign up with your employer sponsored retirement plan. You may not be thinking of retirement now, but money invested early in your career will compound into some pretty impressive figures by the time you are ready for retirement. You can save on taxes at the same time. Always a good idea when investing.

Once your high interest debts are cleared, you have a cash reserve and you've begun saving for retirement, you can turn your attention to additional investments. Mutual funds are a good place to get started. Look for the highly rated funds. Check theMorningstar ratings and pick from the four or five star funds. When you're just starting out you can afford more risk (and the promise of higher rewards) than when you're closing in on retirement when asset preservation is most important. Choose a fund that matches your goals. With so many good ones out there, a nice match is easy enough to find.

If you want to get into the stock market, be sure you understand the risks (and rewards) involved. You can discover much about individual stocks and market behavior from books you can check out of your local library. Newsletters are another good choice. I found some great investment opportunities in newsletters I've subscribed to over the years and made gains that have more than paid for the subscription cost.

No matter which direction you choose, always remember that wise investing isn't about getting rich quickly. Invest for the long term and always do your homework first. Getting started with investing is easy and it's the only way to build true wealth.

Learn more about this author, John McDevitt.
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