One Minute Money Lessons: Worked Hard and Saved a Lot? Make Sure Your Savings are Working for You!

One Minute Money Lessons: Worked Hard and Saved a Lot

? Make Sure Your Savings are Working for You!

You've worked hard and amassed a small fortune. Congratulations, you're not like most and you know it. You've got a good amount of money banked, but, unless you are managing it properly, it's not growing as fast as it could. Here are four important steps to take to make sure your money is safe, sound, and building your nest egg.

1. If It Sounds Too Good To Be True

I know you've heard this before: If it sounds too good to be true, it probably is. The only offense I take to this saying is the word "probably." Once you have reached a certain threshold of invested assets, you become a sought after investor. Think that all of the investment companies out there don't know who you are? They do and they are coming right for you. Once you reach a high level of savings, you will begin to receive solicitations from all types of investment firms real and fake. Don't let greed get the best of you; there really is no way to guarantee a 12% return in this market. Vow to yourself that you will only invest in vehicles that provide realistic returns, that are offered by reputable companies, and that you fully understand.

2. Let Someone Else Be Your Expert

You are probably busy out earning more money, so hire a reputable planner to help you understand the best way to invest your assets. Allowing your hard-earned money to wallow away in a low interest rate bank account is serious neglect. That type of treatment is wasteful when your money could be earning more in a well diversified portfolio that meets your investment needs. Find a Certified Financial Planner who can lay out a game plan for you and your assets that will get you to your financial goals.

3. But, Always Keep a Hand In don't let someone else manage your money to your exclusion

You wouldn't sign-off on a report at work without looking at the back-up data, so do the same here. When the financial professional you've hired makes a recommendation, you need to make sure that you fully understand what the product is and how it helps you meet your goals. Even here, if it sounds too good to be trueThe truth is that most of us do not need any investments that are out of the ordinary. Most of us, even the wealthy, can reach our financial goals by investing in mutual funds, stocks, bonds and ETFs.

4. And, Don't Pay Too Much

It's true that you've earned the right to hand the heavy lifting of money management off to a professional, but that doesn't mean it has to cost an arm and a leg. Understand all payment terms up-front so that there are no surprises. If you've hired an adviser to actually manage your assets for you, expect that you and the manager will agree on a portfolio goal and that the manager will purchase and sell securities to reach that goal. The goal could be as simple as an allocation target (80 stocks/20% bonds) or as complex as a bond ladder that needs to be monitored frequently. Be sure that the work done matches the fee structure. Most money manager fees range from 1% to 2% of the invested portfolio giving the manager the incentive to see your assets grow. Rarely should you choose to "pay for performance" as this puts a particular pressure on the manager and you will find it difficult to check his numbers (think: Madoff).

POST COMMENT

New Kqc Swirl Professional Ceramic Curling Iron NASCAR Photography: 3 Simple Tips to Shoot Professional Pictures Semiconductor Jobs In The Manufacturing Industry TV aerial adjustments may be better left to the professionals Animation Jobs Template Based Web Design Solutions Versus Hiring A Professional Web Design Firm "appliances To The Countryside" Needs To Do A Good Job Supporting The "three Rural Dental Hygienist Job Outlook A Day Of A Graduate Pursuing Jobs What Is Professional Liability? CAN I BE FIRED FROM MY JOB FOR FILING BANKRUPTCY? How To Keep Your Building Looking Professional Projects For Woodworking