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Articles from the Category of Economy
Investing Strategies for the Current Economic Cond
Posted by: Leona Jones from Dotsearchmedia on Monday January 28, 2013 at 12:55 AM   (-08 GMT) | Comments (0)
Tags | Savings | Categories: | Economy

The current economic situation has left most investors trying to manage emotions of relief and panic. The economic meltdown prompted investors to deduce ways through which they can avoid risk in the financial crisis while investing. But the economic recovery pranced on most investors unguarded, leaving them reworking on their investment strategies. The volatility of the current economic situation peppered with risk of extreme loss of profit which has left most investors in the middle of a maze again.

So, what will you strategize before investing in the current economic condition? Here are some ways to help you make better decisions.

Invest in precious metals. Silver is one precious metal which isn’t affected instead stays afloat during times of economic crisis. It is a dwindling metal and thus much wanted. Moreover, it is used widely for the purification of water, making jewellery and in electronic industries. Purchase silver bullion as it is cheaper and can be stored in your home without you having to display it in your bank account. You can also invest in gold as its rate isn’t really affected by inflation. Petroleum and technology are two commodities in high demand even in times of inflation. Thus various commodities are worth investing in but like before every investment, profound research, diverse suggestions and then a properly thought decision must be the correct way of investing.

Aim for high yield as it reduces risk and leads to an improvement in efficiency when concerning stocks and bonds. But like every other investment, high yield comes with risk but if you work on downside protection, risk can be avoided. The income must be allowed to compound over a period of time to gain profitable returns.

Do not invest all or major part of your money in one place. Diversify your investments and keep a backup. It also helps in determining the rate by which you will gain returns. Over a long period of time stocks result in being reliable than bonds. Do not spend from your principal, rather from interest. Do not measure your returns with someone else’s. Measure them with the objectives you set prior to gaining your returns.

Maintain an emergency fund and put money enough to keep you afloat in cases of an unexpected unemployment or a severe financial crisis. You never know what might happen just as credit companies and everyone else was carefree before the economic depression of 2008. Also pay off your high interest debts first. Credit card debts never help in times of economic crisis. While you have the ability to pay off and clear all debts, go for it and be relieved.

During times of economic instability, scam artists love to scoop as much money as possible. They are too clever and study the market closely and approach or lure investors into their trap, taking away a gargantuan amount of money. There are many questions and ways found on the SEC site to make out if the person approached is a scam artist or not. It is imperative to discuss thoroughly before investing. Precaution is important for once you’re fooled; there is no way of recouping what you’ve lost.

I’m Leona Jones and I write investment related blogs and I’m currently focusing on ppi claims related articles.
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Real Estate Investing
Posted by: Joseph E Poff, CPA CITP from Auburn Software, Inc. on Wednesday August 4, 2010 at 8:04 PM   (-07 GMT) | Comments (0)
Tags | Investing, | Mortgages, | Real Estate | Categories: | Debt, | Economy, | Real Estate

The Real Estate market has been and will continue to be a highly leveraged commodity. Sure, right now it's in the dumps - hardly anyone can get loans - those that can are too afraid. But there are signs it's already easing. For example, appraisals now must be made by those familiar in the area - there are issues about whether foreclosed properties should be in samples. Applications are becoming less restrictive too - ever so slightly but they seem to be easing. Credit score minimums have also been lowered.

The near or at 100% financing we had enabled a lot of people to buy property - residential and commercial alike who otherwise may not have been able to do so. Under some circumstances that 'can' and 'does' work - but you can't just blindly do it - you need to really look at the situation. Something that wasn't happening in the industry just prior to the collapse. But with or without the 100% financing 70-98% was common place and most of the time worked and still will work. It will be common place again.

In business you make money by leveraging yourself by your employees (or perhaps by machines). If you never had employees a business would have difficulty in growing or surviving.  It's the same in Real Estate - many clients of mine bought their own buildings to house their business in highly leveraged loans. It was rare when they didn't work out. Everyone won in those - my client was in better shape than renting - the bank did fine - things were great.

The concept of cheater intro interest loans, negative amortizations, the borrowers 'pretending' they didn't understand and the borrowers that really didn't understand - no wonder the Real Estate market had what the stock market calls a major correction. But we will go back to the heavily leveraged loans - it just has to happen. Along the way - Real Estate values will go up.

The market is still in a state of flux but smart - nerves of steel investors could make some money by buying some Real Estate. While prices might still drop - say another 10% if you buy now - the likelihood is that would be the extreme and we are probably at or near the bottom now. Signs of stabilization are showing up - not great - but stabilization. Also, pressure will be on our elected officials as the election season starts.

So, depending on your cash situation and investment strategy you might want to investigate the availability and pricing of some properties be that commercial, residential or land - all depending on your personal situation.

Be smart - don't over commit either physically, mentally as well as financially. Real estate transactions can be stressful but the more of them you do the easier it becomes. If you're planning on developing a property - well that's a lot of work - research it first - know what you are doing. If you want to be a landlord be prepared for it being vacant and the dead beats that leave your rental house in shambles. On the positive side - don't look for a quick return, but given time you will come out ok. Just think of the population increases - mathematically, they will have to increase in value.

As an alternative to investing directly into a project you could invest in a mutual fund or similar type investment that specializes in Real Estate projects.

Joseph E Poff, CPA

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