In a much too familiar movie, the Fed is once again signaling that all is well and they will resume their tightening cycle at the June meeting; having watched this movie 4-6 times a year for the last several years, I think we have a pretty good idea what the ending will be.
Once an individual or family has reached a point in their lives that they have enough income to easily pay their basic living expenses and other bills, they often desire to put their excess monthly cash flow to work in an investment.
Perhaps the most important factor in formulating your investment plan is your risk tolerance; that is, the amount of risk you’re willing to assume in order to achieve your most important objectives.
All investors – be they conservative, moderate or aggressive – need to understand that the level of returns they expect to generate is directly related to the amount of risk they are willing to assume – the higher the return, the higher the amount of risk one needs to take.
We all have a certain emotional attachment to our money, which is very logical since we work hard to earn it. We don’t always make the best financial decisions with our spending, especially when we are in heightened emotional states.