You hear economic reports in the news.  You see investment advertisements.  You attend a seminar on how to increase your return or reduce your taxes.  Your friend tells you about a great opportunity.  Your financial advisor suggests you put your money into something as part of the planning they are doing with you.

You can trust your friend, your advisor or yourself, but do you have a strategy or system to evaluate the options you are presented?

Where do you start to decide if something is a good investment for you? Obviously, having professional assistance is important, but it’s not good for you or your advisor if your deciding criteria is simply ‘I trust you.’  It is also not good for anyone if your standard answer is ‘I only invest in xyz because that’s what I have always done’.

Without going back to full-time school to learn investment fundamentals, you can start with a few key questions:

1. What is my financial goal, short-term and long-term?

2. What type of investment is this: income, growth, combination, etc.?

3. What is the value of my overall investment assets?

4. What percentage of my overall investment assets does this investment represent?

5. If I invest, how and when would I get my money back?

If you start by considering the overall foundation of building an investment portfolio, the individual investment selections will be easier to fit into place because you will then have a basis for asking questions to help you decide what’s best for you.