What First Time Investors Should Know About the Stock Market

If you want to buy and sell shares and stocks, you would do so in the stock market. This is the system in the United States that has afforded many people to become wealthy from their investments. Prior to making an investment in the stock market, there are things that you should know, especially if you are an individual investor.

Stocks and Shares

Ok, so you want to trade stocks and shares as an individual, but you don’t’ have a clue of how to do this. You are not alone. There are many people who have the same goals, but don’t know where to begin. You don’t have to worry about whether you are a major trader or not. Everyone can trade, no matter what their financial background, experience or the amount of funds they have available to spend. Stock prices usually rely on supply and demand. The stock marketers trade on the trading floor or at least, that is what it is called.

The Trading Process

You probably have seen it on TV where the traders are always shouting out what they are bidding as well as the stock quotes. It might seem intimidating to you, but it is the regular practice of how the traders operate. However, if you don’t want to get involved in that big platform, you can trade on your computer from the comfort of your own home. You get to log into a website that is connected to the stock market and trading network.

The Beginner

If you are a beginning stock market trader, don’t rely on the Internet for advice. It is better to speak to a financial advisor before investing in stocks or you can lose your entire life savings. There are some things that you should know before you take the risks. You have to study the stock market and this takes a lot of hard work and motivation. You also have to be patient and diligent. Below are some basic tips on how to get into the stock market.

Things to Consider

Don’t use the usual rulebook because there are no specific investing rules to follow. At times, some investors go with gut feelings, but this is also a risk. There are no guarantees that you will be successful.  Even the best financial analyst has to make an informed decision when approaching the stock market. They will also conduct extensive research and then start buying and selling stock using the information that they found. You should do the same thing. If you do otherwise, it is like jumping into the sea when you know that you cannot swim.

The Risks

Next, you should figure out how much risk you are willing to take and this will depend on the specific financial goals that you have set. So you need to make goals first. If you are investing as one person, make sure to assess the reasons why some stock prices are higher or lower. However, bear in mind that price is not similar to value. There could be an economic downturn that affected the stock market.

The Bottom Line

Before investing, check to see what the company is worth, meaning how much profit they have made after paying taxes. It is best to spread out your financial risk because there should always be balance in everything. Lastly, try to overcome any fear that you have of the stock market. Any pre-existing fears will only hinder your progress.


Investment and Financial Advice for the Young Adult

It is not easy to manage money, especially when you are a young adult. Money management is not taught in most of the lower level schools in America, but when you get to college, you are being offered those courses. However, it is a choice that only you can make. Conversely, personal finance courses are a prerequisite in roughly seventeen states for high school students. Education about money is better learned from the people who have already made the mistakes that you would normally make. Below are some tips to help young adults avoid the shortfalls that come with finances, especially in a financial hardship situation.

Attend College

Before graduating from high school, you should already be thinking about going to college. Don’t second guess the significance of college because it does prepare you for the outside world. You will quickly learn the importance of money when you are attending college, even if it is a community college. Your time in college will also teach you how to save, how to spend and how to borrow. With a degree from a reputable University, you will be more of an asset to a company and you will learn the ins and outs of finances and use the experience in your new career.

Discover Your Talent

What is your talent? What are you good at? Have you discovered it yet? If you don’t know for certain the extent of your natural abilities, you may want to take time to find out. It is with this talent that you will wind up getting an initial start to a rewarding future. However, you have to devote the time to learn how your talent can make room for you. With success comes money and you have to learn how to manage it.

Plan for Retirement

You are never too young to plan for retirement. If you are in a job that offers a retirement plan, you should not hesitate to do so. When you plan for retirement early, your future will be better. You will be way ahead of the game so that when you do retire, you don’t have to live only on social security benefits.

Money is Valuable

When you think about money, you should think about something valuable. You cannot live without money so you should never abuse it. In exchange for a purchase, the retailer gets your money and you get a product or service. Money is an exchange, but a valuable one.

Don’t Be Afraid to Invest

Investment is not only for old people. You can invest no matter what your age. So, it is time to overcome those fears and start investing in a couple low cost mutual funds – just to get your feet wet. Ask for financial advice, if you are uncertain or still afraid.

Limit Credit Card Use

When you are armed with a credit card, you may feel powerful enough to spend money when you want to. However, plastic does not equate to spending because all you are doing is racking up a huge bill over time. Watch how you spend your credit card. Instead of using plastic, save up your money for those purchases or just ignore the impulse to use the credit card.

The Bottom Line

Tap into the resources that you have available to you and this includes parents, other family members and friends. Be accountable to someone and ask for help when you need it. Avoid making costly financial mistakes. Be sure to seek professional help when all else fails.


What Companies Benefit from the Poverty Industry?


Have you ever heard the term ‘loan shark?’ Well, many believe that companies like American Express, General Motors and other blue chip companies are loan sharks. They take advantage of consumers with bad credit or bad financial situations. The term is similar to fringe banking, which is a process that describes check cashing stores and pawn shops. These industries serve consumers with low income, usually those who live in urban America that don’t fit into the same model or profile as other consumers who use mainstream financial institutions.

The Pawn Shop

The interest rate for a pawn shop loan usually exceeds 200 percent. Yes, you heard right – 200%. Pawn shops are raping the poor and in many cases, these are people who are going through financial hardship and would need to be shown empathy.

Check Cashing

In a check cashing store, you can look to pay up to ten percent of the value of the check that you are cashing. Many large check cashing corporations are profiting from this practice and it usually affects the poor. It is a ravish cycle and the poor have little options available to them.

Taking out a Second Mortgage

If you are a homeowner and you are on the market for a second mortgage, you could be paying an interest rate of up to 30 percent, if you have bad credit. Yes, some mortgage companies use the fringe bank technique to charge higher interest rates to the unsuspecting consumers with bad credit. It was worse a few years ago when subprime mortgage loans were being fraudulently created and brokers were making a financial killing. Since then, the government has cracked down on this, but some lenders will get away with it. This is especially true when the consumer wants the loan to repay bills or do home improvement.

Used Car Dealer

This same practice is initiated by used car dealers that work with financial institutions to milk consumers with bad credit. Finance corporations like ITT charge huge rates of interest by acting like lenders to the borrower with limited income and a last resort. Online registration loans would be better than dealing with any company that has bad business practices.

Rent to Own

Let’s talk about those stores where consumers can rent to own. This is a $3.7 billion dollar business because consumers are charged up to five times of what other traditional retailers charge. By the time, the consumer finishes paying for the item; they end up paying an exorbitant amount.

Trade Schools

Some Trade schools will entice students to sign up and promise them work after completing their course. In many cases, they will offer a loan to students who lack funding; only to find out that they leave the school with little skills and a large debt.

The Bottom Line

Companies like these will usually target people of lower income and in deep financial debt. The interest rates charged are typically higher than what other Americans pay. The pawn broker also tacks on late charges if the customer doesn’t pay on time. As a consumer, you have option to seek legal counsel, if you find that you have experienced unfair lending practices.  

4 Ways to Start Investing with Less Than $500

Many people are under the impression that investing is only something that the very rich can and should do. In truth, though, everyone can benefit from investing intelligently, and, furthermore, almost everyone can afford to invest. In fact, believe it or not, even if you have as little as $500 (or even less!), you can and should start investing today.

Affordable Investment #1: Dividend Reinvestment Plans

One of the best options for investing when you don’t have a lot of money upfront is a Dividend Reinvesment Plan, more commonly referred to as a DRIP or DRP. With these plans, you can buy stocks from companies yourself, meaning you don’t have to hire (or pay) a broker, which can cut the costs dramatically.

As long as you have the money to purchase at least one share, you can typically take out one of these plans. As a result, you’ll enjoy dollar cost averaging, which assists with long-term investments; dividend reinvesting, which can enable you to buy more stock; and very small fees- in some cases, even no fees. Talk about putting $500 or less to good use!

Affordable Investment #2: Target Date Funds

Another option you may wish to consider is a target date fund. With these funds, you can, quite literally, target your retirement date. Doing so ensures that your money will stay safe when you most need it to, i.e. when you start getting close to retirement.

While it is true that some target date funds require a minimum investment of at least $1000, that’s not the case with all funds, and some will gladly accept what you are able to come up with.

If you go this route, just be careful to choose a fund with reasonable fees- they can sometimes get quite pricey if you’re not careful. As long as you’re cautious, you’ll benefit from the security and the fact that you won’t have to manage your own portfolio or hire someone to do it for you.

Affordable Investment #3: Go Into Business

Most people think that starting a business requires a boatload of money, and, while that is true in some cases and with some types of businesses, that’s not always necessarily the case. With less than $500, you could easily start a small business, such as a profit-earning blog, a business where you sell handmade goods, or even just something simple, like an in-home child care business or a pet sitting service. The possibilities are endless if you put your mind to it, and, in some cases, you don’t even need any money to get things started.

Affordable Investment #4: Stick it in Savings

Finally, if all else fails, or if you just want an investment with zero risk, remember that you can always put your money in a savings account. Sure, most accounts don’t earn a ton of interest, but they do earn something, and at the end of the day, making at least some progress is what investing is all about!


The Best and Worst Investment Recommendations

For many people, investing is quite confusing. In fact, most people have no clue when it comes to the entire financial industry. For that reason, investment advisors have popped up all over the place to give advice to people who need it the most. The advice may work sometimes, but not always. Let’s take a look at some of these financial concepts that are not as effective as investors might recommend. Of course, you will find some absolutes in the investment world; however, there are a few mantras on Wall Street that investors were aware of in the past. Below are a few of the best and worst investment recommendations that you may have heard about.


When an advisor tells you to diversify your portfolio, you may want to reconsider this, even though; this method of investing has always been touted as a way to provide protection to your portfolio. Most financial advisors believe that when someone diversifies, it is possible that some stocks will lose its value, but on the other hand, some will also gain in value. For instance, when you invest in the emerging markets and in stocks with small caps rather than blue chips only, many investment advisors think that this is a good tactic to provide protection to your portfolio. This is not always true.

Money Markets Accounts

Investment advisors indicate that money market accounts are safe; so much so that even 401K retirement accounts flaunt money markets as being live cash. Before you go following this advice, it is best to understand your portfolio and stay abreast of what your financial investor is doing with your funds.

Full Mortgage Payment

Is it logical to entirely pay off your mortgage or invest the money for a greater return? Many will think so. However, when the bear market hits, all of this reasoning may seem like nonsense to you. Yes, the values of real estate can take a dip. However, even if the real estate market is declining, the bank will never foreclose on your home once your mortgage balance is paid in full.

Timeless Recommendations

Now let’s take a look at the good recommendations, which are always trending and altogether timeless. Most financial advisor will tell you to have a financial plan. With a plan, it is more difficult to fail. Your plan will be a blueprint to your objectives and allow you to be proactive in managing your financial investments. You should also put away some savings in an emergency fund. You never know what will happen down the road. The emergency fund is similar to your life insurance policy. Live with what you can afford. Don’t go overboard. Spend less than what you earn in income. If you were to lose your job tomorrow, at least, you may not be financially strapped.

Risks and Traction

Never believe that no investment can fail. If a financial advisor tells you that investing is not a risk, you should find another advisor. You can lose money when investing. Moreover, if your investment is taking traction and you see a rise in stocks, it won’t last long. If anything sounds too good to be really true, use your common sense.

Would you trust investing advice from snapchat?

Most of us are fully aware of how powerful social media is these days. I know I check my Facebook page multiple times a day. Sometimes I find myself scrolling for longer than I expected, and when I come to, I realize that I don’t remember anything that happened around me. It has become a huge part of our everyday lives. In fact, 90% of the ways I keep in touch with family these days, is through social media. Often times I wonder what I am reading or watching on social media applications or websites and if they are things I should take seriously. Currently, most social media sites like Facebook, Instagram, and snapchat are looking for ways to make money from their wide range of users. That idea to make money is to offer investing advice. So I have to ask. Would you trust investing advice from Snapchat?


Let me start by saying I think it is an interesting idea, and a valiant one at that. I am all about a company looking at ways to make more money. Facebook has evolved so much over the last 11 years, and has been able to raise money without charging a dime for some kind of subscription to their site. Snapchat though, that is a different story. When you think about Snapchat, it is really a basic yet highly used application. There is a ton of traffic on the application and they could probably reach the appropriate audience. I just don’t see it, I mean, their ability to keep your pictures and videos go away isn’t all that great. With that being said, do you trust them with your money? I don’t know exactly how they would give the advice; maybe they send you a picture of possible stocks and then the picture vanishes! Leaving only the few who could make out the picture, go and invest their savings on it.


All joking aside, it is something that most people seem to be pushing aside as something they wouldn’t trust. For example, Instagram is great for taking really cool pictures of something, maybe the place you are on vacation, and changing filters to make it look better than it is. Would you trust them filing your taxes? This is a typical situation of a company that has something they are really good at, and trying to venture into something that is so far outside of their forte, that users may see it as a ploy. For something as serious as investing, it is probably better to go through a company that has made their name by their investing advice.


Social media has proven that is has the possibility of getting into many different avenues. Users on social media applications have proven that they will spend money on games through social networks, just to get to that next level. However, the next level in social media is probably not investing advice. So, should you trust Snapchat for investing advice? If it even happens, I’d say stick to them for vanishing pictures, and find something a little more conspicuous.


Where’s the Payoff for Active Investing?

Active investing is something that most people tend to feel strongly about, one way or the other. Some feel that it’s the absolute best thing you can do, while others are against it and feel it’s unnecessary. Those who believe strongly in active investing feel that, in spite of what economic downturns may occur, active investments will still stand strong and valuable when compared to other types of investments.

Supporters of active investments also take up for the potential downfalls of these investments, claiming that while active stock funds may not always be on top, such as in times of rallying, they have more staying power than those investments that only perform well in certain markets or times.

These defenses for active investing have been around for a long time, though they became more popular and common after the stock crash of the early 2000s, in which they performed well. Their performance during the crash, in fact, gained them more supporters and led to people thinking of them as a sort of “insurance” against bad economic times.

As they grew in popularity, the premium associated with active investments climbed sky high, with people truly believing their investments would pay off later, when things got bad again. In truth, though,that “pay off” never came, and many are still waiting for it, some say pointlessly.

Even when the recession hit in 2008, which most thought was when their active investments would really pay off, that didn’t happen. At that point, everything from large companies to foreign stocks was on a downward spiral, and active investments followed the unfortunate trend as well.

At that point, many investors gave up on their active investments, leading to poor outflows for this investment type. However, some have held strong to their investments, believing that eventually they will pay off.

In truth, though, these stocks have had multiple chances to “pay off” in the years since the start of the recession, and they still have yet to really perform the way people hope for. When blue chip stocks dropped in 2015, for example, active stocks did not “come through,” in spite of many people believing this was finally their chance to get the active investment payoff they’d been planning for and banking on. And, since history tends to repeat itself, experts aren’t really hopeful that active investments will ever truly pay off in the way people hope for and were falsely taught to believe, at least not anytime soon.

As such, this may not be the smartest type of investment you can make, at least not if you plan to bank a lot of hope on it. However, every person’s financial situation and needs are different and unique, so before you make any sort of investment or take advice from anywhere, talk with your investment adviser or another financial professional about the best investment options to meet your specific needs. Chances are, though, your adviser won’t recommend active stocks, at least not right now.


5 Golden Tips to Invest Before You Die

The next financial year is coming at the fast pace. For many, it means the time to pay taxes. The mayhem and confusion are normally at high this time, especially for those who do not have any idea about the A, B, C, D of personal finance. It is often recorded people saying that taxes make them empty-handed and now they are in the poor financial condition after paying taxes. If simply a tax can create so much chaos, how will you manage the unplanned finances?


It is a no brainier that a good planning makes things perfect while a bad planning can destroy the whole universe around you. Personal finance is one of the significant examples where if you have not planned your expenses and saving, you will be ruined in no time.


It’s OK, the learning financial planning is tough, but not impossible. With some wisdom and smart move, you will be able to overcome your fear of financial planning very soon. There are some golden rules that you must follow before planning for your finances.


  1. What is your financial goal?


Every person has some distinguishing need in terms of financial goal that demands priority.  If you don’t know your destination, then how will you start your journey? Before planning for the personal finance, write down a goal. For instance, in the upcoming 5 years, you have to buy a house and you need money for that. You are going to retire and you need money to cover up the living costs post retirement, or you may need money after 20 years when your kid will start his/her college. Whatever be your goal, for the current year and for the life, make a list so that you know how much money you need at a particular phase of your life.


  1. Know your income and expenses clearly

A monthly budget helps you understand your income and expenses. It also helps you realize your financial deficit or bad expenses. You are now in a phase where you need to cut your expenses.


  1. Invest as much as you can


As per the golden rule, you should be able to save you more than 60% of your income. Savings are of two types, one that is the classic saving where you save money without expectation of extra high return like saving-account, fixed account, government bonds or recurring account, etc. The other one is intensive saving or investment where you invest your money in terms of making a big corpus in a particular period. These tools are like mutual funds, share market, ULIP, etc. You can also save taxes as many countries offer tax exemption on various investment tools as per their prevailing tax laws.


  1. Make proper plans for your retirement


The cost of long life is also a great threat just like the cost of early death. You cannot avoid the period post-retirement where your regular income will be slashed down to almost negligible, but the expenses will be same, and  even increase. If your retirement plan is not good enough, your survival post-retirement will be a hectic task. The key is to invest in the pension plans as well as long-term ULIP for accumulating enough corpus so that you can maintain your living standard even after the end of your working-era.


  1. Diversify your investment, but invest more in equity market


Investment can be categorized into two different divisions; the first one is fixed assets while the second one is in terms of liquid money. Both hold significant value in your life. A fixed asset helps you fulfill your long-term financial goal, whereas liquid money is for the current monetary needs.


Similarly, the investment can be categorized into money market and equity. In money market investment, you get a guaranteed return over a period, but the return is very low while, in the equity market, your money grows very fast, but the market risk is always associated.


If you diversify your money, you will be ready to accept any economic challenges in your life. Diversified money also lowers the risk of volatile market in the long run. The more you invest in equity market the higher yield you can expect and the better you may prepare yourself financially.


Life is unpredictable and so are your needs. The obvious expenses one is very easy to manage, but those expenses, which are unforeseen, can be tackled only through proper planning. The time of financial planning starts now as you never know when you may have your last breath, or when you may have to face the curse (please forgive me here) of living more than 100 years.


The sooner you start the greater you accumulate for the future. The only mantra is to start now, but wisely. Look for financial tools and modes available and diversify your investment after proper research.


Prison Investments?

Everyone is aware of the Prison Industries running in the United States, covering up two million prisoners (both federal and private prisoners) around the country itself. Most of these prisoners, some guilty of their crimes while many are innocent due to lack of resources for good legal representation, are Black and Latino serving their time in prison and slaving for several industries in return for close to absolutely nothing. For big tycoons, prison investment is like a pot of gold, due to which they do not ever need to worry about employee vacations, time off requests, strikes, or paying unemployment insurance. Their workers are always available full-time with no absence or family issues. Moreover, these prisoners also face punishment for refusing work by getting locked up in isolated cells.


In accordance with California Prison Focus, “no other society in human history has imprisoned so many of its own citizens”. In the last ten years, there has been a recorded tremendous increase in prisoner population, which puts the United States at the top for holding twenty-five percent of the inmates.


The question here is; Why are there so many prisoners locked up in the states? The reason is quite obvious. The United States is one of the fastest-growing industries in association with the prison industry complex. Its investors are on Wall Street. The Corporate stockholders are making money off of these prisoners on a long-term basis, in order to expand their workforce. Overall, this multi-million dollar industry system is feeding itself. Frightening enough this booming modern-day slave industry has its own conventions, websites, and trade exhibitions. Can you imagine people in the twenty-first century strolling carefree around a convention, enjoying looking at more ways to profit off of free labor of men and women who are literally shackled in chains for crimes that many of them did not commit? Reportedly, the industry is also comprised of direct advertising campaigns, construction companies, architecture companies, food supply companies, padded cells in large variety of colors and investment houses on Wall Street. Wow.


According to the human rights organization, the investors who are continuously investing in prison industry complex are earning massive dollars. A long-term prisoner’s sentence is a plus for these investors. Prisoners creating large amounts of profit are also motivating the court system to incarcerate more people for longer periods of time where the time does not match crime. If a man steals a loaf of bread from a store to feed her children, she could face the same sentence as a mass murderer simply because an investor needs a new sports car.


Currently, private corporations have legalized the contracting of prison labor in 37 states that are mounting their operations inside state prisons. Reportedly, companies falling under this list are as follows: Nordstrom’s, Revlon, Intel, Northern Telecom, TWA, Macy’s, Pierre Cardin, Target Stores, IBM, Boeing, Motorola, Microsoft, AT&T, Wireless, Nortel, Lucent Technologies, 3Com, Intel, Texas Instrument, Dell, Compaq, Honeywell, Hewlett-Packard, and many more.


The economic boom generated by prison labor is incredible for all of these businesses. According to the reports, profit went up from $392 million to $1.31 billion, between the years 1980 and 1994. But the prisoners are earning very minimum wage out of it, approximately $2 per hour.


Private prisons are also benefiting from prison labor, where 18 corporations are guarding 10,000 prisoners in 27 states. Correctional Corporation of America (CCA) and Wackenhut are the largest, controlling 75 percent of the inmates. On the other hand, the amount of money received by private prisons is guaranteed for each prisoner. On the basis of good profits, new business of import and export of inmates with long sentences has also been formed. Overcrowded prisons fall under this category.


And they say slavery no longer exists? More stories are surfacing of men and women of color who were wrongfully convicted of crimes they did not commit. They were picked up, thrown in a line-up, and found themselves shackled in chains in order to increase the bottom-line of an investor. This is America’s dirty little secret that many will still turn a cheek to say does not exist.


5 Creative Investments For When You Don’t Have Much Money

Investing always sounds like a good idea, but how can you get started when you only have a little bit of money to sink into your investments? It’s actually not at all an uncommon problem, especially for beginning investors. Even better, there are some solutions for it. Here are five investments you can make that don’t require a lot of cash or major assets to get started.


Dividend Reinvestment Plans


If you really don’t have much money at all – let’s say $20 to start – dividend reinvestment plans (commonly referred to as DRIPs) may be for you. These little buggers allow you to invest small amounts of money into dividend-paying stock. Essentially, you buy a little fraction of a stock directly from a big company like Coca-Cola or Verizon and the dividends earned will be automatically reinvested into more stock. It’s a small start, but especially if you can afford to do it regularly, it’s something that can pay off big in the long run, especially as you start to diversify your portfolio.


Save Online


Maybe you’re just looking to build up some interest right now while you save to make bigger investments in the future. In that case an IRA is out, since you won’t be able to get your money for a very long time, and a savings account might be the way to go. Opt for an online savings account. Their operational costs are lower since they have no brick and mortar stores to maintain, which means that you can generally get better interest rates, something around 0.5 percent to 1 percent, as opposed to the 0.1 percent you’ll find with a standard bank.


Get Some Wine


Not every wine is going to appreciate in value, but if you’ve got a bit more than $20 sitting around but not the couple thousand you’d need to really sink into stocks or bonds, a fancy bottle of wine might be one of the most interesting investments you can make. It takes about five years for a bottle to mature for sale, and a lot of sites sell in multiples, so grab three if you can. Just remember not to drink them while you’re waiting to sell them off.


A Home


Now, a home is by no means a small investment, but it’s one you’re already likely paying for in the form of rent. You get no return for your rent money, but you could get a fair amount for a home, and it won’t necessarily require more than what you’re already paying for wherever you live. If you can get a mortgage that comes in around your rent amount, there are ways to get mortgages with little to no down payment. If you can secure one of those, you’ll be able to roll your rent right over into your mortgage, and then you’ll have some real property to your name, too.




This nifty little app lets you invest without even thinking about it. It rounds up purchases from any linked credit or debit card account to the nearest dollar amount and invests the spare change in six different funds based on your risk tolerance. It’s the easiest way to invest with nothing but the change in your (virtual) pocket.