Zachary Knable

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Many people ask “what should I invest in other than cash?” For many this is a complicated topic, on one hand deposit accounts are typically principal protected, on the other hand they earn very little. For people in their 50 to 70s, they remember the days of 10+% interest rates for CDs and Money Market accounts, unfortunately those days are long gone. For the laymen who has never invested in the market and has never had a retirement account such as a 401K, the idea of putting money at risk for growth potential is a sometimes terrifying thought. This brings me to my thought of how investing in the market is communicated to people with little to know experience, when people hear the word market they automatically think of stocks. I have had many people come to me and ask about a friend’s stock pick and why they should take advice from a professional when their friends have doubled or tripled their money? I always ask the same question, have your friends ever told you about a time where they lost money? Typically a person will laugh and respond with, no they haven’t. Stocks can be very rewarding especially individual stocks where growth can be unlimited. However for the first time or novice investor the recommendation I would have would be a mutual fund or a portfolio of mutual funds that would give growth potential and yet provide some hedge against total loss. If the individual stock you purchase goes bankrupt, you lose your money. If that same stock is in mutual funds with hundreds of others you will see minimal fluctuation in value. Good Luck!