what are some of the outdated investing principles?

When it comes to investing make sure you are not applying outdated investing principles that have become obsolete in today’s investing world

Below are some of the rules we believe no longer apply:

• You need lots of money to get started

  No, you can easily open a brokerage account and buy low ETFs requiring no minimum amounts

• When investing with low funds, time is to your advantage as you benefit off compound interest

• You need a financial advisor to start investing

• No, you can educate yourself and save on the fees they’ll charge you by forcing you buy their products

• Reach out to a tax consultant instead to help you reduce your tax liability

• You should pay off your mortgage debt before investing

  No, on average the stock market returns have had a significant higher return than mortgage interest rates

• Investing is complicated and risky

  Not investing is risky,why count on only one source of income

  If you don’t take any chances, you reduce your potential returns

  Your goal should be to manage the risk that comes with investing by leaving out the emotions and make calculated risks by investing in ETF, Index Funds and buying value stocks

• You need to wait till retirement age to stop working

  No, retirement is determined by a financial number and not by a person's age.

• You need to invest early on and calculate how much you'll need to cover your basic living expenses which is your FIRE number (Financial Independence Retire Early)

• Your FIRE number is equal to your annual expenses multiplied by 25.

  For example, if your annual spending is $40,000 a year then your FIRE number would be $1 million. This is assuming you will be withdrwaing 4% while the rest remains invested.

• Take matters into your own hands

• Follow @femvestors for more tips on personal finance

  Comment below an outdated principle you once believed. Tag a friend and share