And The Top 10 is…

When I wrote The Graduate’s Guide to Money, I came up with a Top 10 Money Principles list. I wrote about them in the book, and I reference them when I speak with groups so I thought that every now and then, I would sprinkle in one of my Top 10.

In classic David Letterman style, we’ll start with number 10 – Investing: Just do it.

When I speak to groups, whether it is to a women’s group or a group of college students, investing is the topic most frequently brought up by participants. Libraries have been filled with books on investing, and it is downright intimidating to try to dip your toes into that kind of pool. I know because for years, I kept my money nice and safe in interest only investments and missed out on the greatest stock market run in history – oops.

So, when you have money that you don’t plan to use for 10 years or more (like your 401k or IRA if you are a decade or more away from retirement), get it invested. Take 10 minutes a day to read the info on your plan website, chat with the rep from the 401k plan, or schedule an appointment with an advisor, but put together a plan to get your money invested.

It is really quite easy now with the multitude of index mutual funds and broad market mutual funds. Don’t know what a mutual fund is – check out Want to see information about a stock or mutual fund? Try This site is free. Enter the name or symbol of the investment and you can get all kinds of information. You can see a chart of the price over time. You can compare it to indices, and you can link to all kinds of information – analyst opinions, price estimates, or key statistics among other things.

If you want to invest just a bit on a regular basis, you can use Computershare to buy U.S. companies in a dividend reinvestment plan. There are all kinds of ways to get going but get going. Do some research. Read some magazines. Talk to someone in the know. You want your money to be working for you and especially in this interest rate environment, you need more than interest only.

Interestingly, I wrote the preceding in early January prior to the market volatility that we have seen since January 5th (and really experienced this week with a 3.7% drop in the S&P 500 on Wednesday.) This is the environment where most investors want to “run out of the store” because the sale is happening so fast and furiously. However, that volatility is your friend if you don’t panic and you remember: you haven’t lost anything if you don’t sell! Prices go up and they go down – all day, every business day. Some days they go up or down a little and some days they go up or down a lot. The key to unemotional investing is to realize that everything is temporary, the market moves in cycles, and over long periods of time, the markets historically go up.

Generally speaking, down days are better days for buying than for selling. Up days are better days for selling than for buying. (Remember the old “buy low, sell high” rule?) Whether those principles apply to the individual securities that you hold is impossible to say, but generally speaking, when you invest in mutual funds and broad-based index funds, the risk of everything going to zero is low. If the S&P 500 goes to zero, I think we are facing bigger issues than how much money we lost – it might really be the zombie apocalypse! Can individual stocks go to zero? Yep. They can and do, unfortunately, so heed grandma’s advice about not putting all of the eggs in one basket.

The bottom line – a principle is a principle because it nearly always applies so the post that I wrote in early January still applies: Investing: Just Do It.

To your financial (and investing) success!