It's important to know what you want to accomplish with your investments before you actually invest. For example, you might want to purchase a home, fund a child's college education or build an adequate retirement nest egg. If you set financial goals at the outset—you are more likely to reach them.
You also want to get a handle on basic finances such as how much money is coming in and going out. This will help you control spending and manage debt. Most importantly, it will help you methodically save and invest, which is essential to building your net worth.
Use the information below to help you establish and meet your financial goals.
You can create a list of your financial goals on your own or by working with an investment professional. We'll show you how to get started.
Know Your Net Worth
You can figure out how much you have (or don't have) to invest by calculating your net worth, the difference between your assets and liabilities. Our worksheet can help.
A positive cash flow—net income that exceeds expenses—gives you room to save and invest. Learn how to calculate your cash flow.
Manage Your Debt
Paying down your debt is one of the best ways to increase your positive cash flow and save money that you then can invest.
It's wise to set aside some money—equivalent to three to six months of living expenses—in an emergency fund to cover any unexpected expenses like car repairs and medical emergencies.
Your credit score is a picture of you as a credit risk to the lender at the time of your application.
The International Financial Securities Regulatory Commission was established to promote investor confidence in the securities and capital markets by providing more structure and government oversight.