Saving for your future
In simple terms, investing is a way to make your money grow and work for you. As you save and invest throughout your life, you can build a sizeable amount to reach a goal such as your first home, college expenses, or cover your living costs once you retire.
Investments, also know as securities, vary in form and risk. Common investments include stocks, bonds, mutual funds, commodities (gold and agricultural products), and real estate. What works for one investor may not for another so thoroughly analyze the investment you are interested in or offered to you. A legitimate investment, such as in a company, will have a prospectus: a document containing financial information and description of the company’s business history, officers, operations, risks, plan and any pending litigation, if any.
Check and verify securities
All offered securities, unless exempted, must be reviewed and registered in Oregon. This enables investors to make informed decisions about whether to purchase a company's securities. A registration will include the securities’ description and financial statements.
Firms and individuals selling investments and providing advice must be licensed. The license financial professionals have is important because it tells you the type of product they are qualified to sell and what advice they are able to provide.
You can find information about investment broker-dealer firms and individual salespeople, and investment adviser firms and individuals on the U.S. Securities and Exchange Commission (SEC) website www.adviserinfo.sec.gov or on the Financial Industry Regulatory Authority's (FINRA) database, BrokerCheck. The database is also linked to the representatives' employment and any disciplinary history.
Before you invest
- Define your financial goals and the timeframes for each. Your plan will help you when you meet with a financial professional.
- Know your financial worth, the difference between your assets and your liabilities. Look for online calculators to help you.
- Pay down debt. The return you may receive on your investments can be eaten away by the double-digit interest you are paying on loans and credit cards. Getting rid of debt means more money to invest.
- Assess your risk tolerance. Are you willing to risk losing money for better results or do you favor investments that are more conservative? This is a personal assessment; do not let anyone convince you move out of your comfort zone.
- Start an emergency fund. Money set aside will help you get through a job loss or extensive home repairs.