Saturday, 24 April, 2004

Pondering investment options

I find myself in a rather odd position financially.  Debra and I have finally saved enough money that we have to think about what to do with it.  I won't be quitting my job any time soon, but we have managed to put together a few dollars that could grow into quite a tidy sum if we invest it reasonably.  Oh, but where to invest it?

I'm not a complete novice when it comes to investing.  I've invested in mutual funds with varying success and opened an E-Trade account a few years back, again with varying success.  I got lucky with a few stocks, blundered badly on others, and managed to make it through the last three years with most of my initial capital intact.  But just keeping the cash doesn't really qualify as "success" in my book.  So lately I've been reading a bit about investing in general, and stocks in particular.  I can't say that I've learned a lot yet about where to put my money, but I'm sure learning where not to put it. Not that I've ever been a sucker for the latest stock tip or real estate deal.  More importantly, I'm gaining some insight into my own thoughts about money and investing.

The two most difficult things for me to do are to get started and to just sit and watch.  It takes a lot of prodding to get me going on something, but once I've started I want to fiddle with it, optimize it, make it work better or faster.  Sitting on the sidelines waiting for results is torture.  I think a lot of people are this way.  Once they start a savings plan, they're not content to just buy an investment and watch it grow.  They want to see results right now.  This plays right into the hands of brokers (even online discount brokers) who make piles of money from people buying and selling stocks.  This also explains my absurd desire to buy a piece of rental property:  it's a tangible thing.  I can see money coming in every month and I can try to find ways to improve the bottom line.  So far I've been able to remind myself of the headaches I had in the past, trying to rent a place and then chasing the tenants around for the rent check every month.

I haven't yet figured out where I'm going to invest for the long term.  Right now most of our little stash is squirreled away in reasonably safe no-load mutual funds, waiting for me to decide what to do next.