There are people in this world who love watching the stock market, who regularly tune into the financial news, who have a subscription to the Wall Street Journal and use it for more than looking impressive to friends and co-workers. If you are one of the individuals who doesn't mind doing the hard work and actually enjoys all the ins and outs of the financial markets, skip ahead to 'Working it out on your own'. If, however, you just don't have the time or the desire to spend at least a few hours each week familiarizing yourself with what's going on with the Dow Jones Industrials, you need help. What is important to you is finding help that you can trust.
Financial professionals come with a variety of titles, from stockbrokers and investment advisers to financial planners and certified public accountants. Each of these individuals have certifying boards or are regulated through your state government and self-regulatory agencies to ensure that they have the knowledge and have shown the integrity to guide your finances. Before you talk to any financial professional, make sure they are registered and/or certified to provide you with the information you will need. The Investor Protection Trust has some invaluable information on how to pick a professional. The IPT booklet can be found here.
Once you have a professional helping you, it would be easy to walk away and forget about your investments. That would be a big mistake. The more you understand your investments, the better prepared you will be when your professional contacts you to make decisions. Reading your monthly account statement is as important as watching the gas gauge on your car. You don't want to run out of gas on the expressway with no stations in sight. Likewise, you don't want to find out that you've been spending money on unnecessary fees and charges six months down the line. You might not need to put in the long hours needed to do your own investing (as in the next section) but you should spend a couple of hours each month making sure you know where your money is and where it's going.
Retirement is the biggest long-term investment most of us make. Everyone wants to come to a day when they can ease up on the working world and do the things they enjoy most without worrying about having the money to pay for it. However, there are other investments that make the journey to retirement easier, such as a reliable car, your own home, an advanced degree, marriage and children. These are shorter-term investments. The important thing to remember is that you need both kinds of investment. Often when we see the immediate benefits of a short-term investment like a new car, it's tempting to use the money we're setting aside for that all important long-term investment of retirement. Don't make that mistake. It is better to cut back on other expenses than to short yourself in your golden years. Having a solid financial plan will help you find the money for everything you want to do.