Ireland’s Independent.ie offers the following helpful tips on how to avoid some of the biggest investment mistakes that we often see clients make.
Pouring all of your money into one investment – such as the shares of one company or bank – can be dangerous. Should your investment take a turn for the worse you could lose a lot of money. Spreading your money across various types of investments should reduce the risk – particularly over time.
Be wary of investment fads or ‘get rich quick’ shares.
Although some people have made millions from such shares or products, others have lost millions too – and you could be the one to get burned if an investment loses its winning streak.
Review your investments at least once a year.
It is important to check how your investments are performing. You may need to consider moving out of a particular investment if it is consistently losing money.
Don’t make rash decisions, as these will often cost you money. Have a well-thought-out investment plan in place.
Understand the amount of risk that comes with an investment – and know how much of your money could be lost if that investment performs poorly.
Don’t invest your money in something if you’re not comfortable with the amount of risk that comes with the investment. Don’t invest in a risky product if losing some or all of your money would seriously affect your financial situation. When investing in shares or investment funds, there will be times when the value of those investments will plunge.
As long as you have chosen your shares or funds well, panicking and cashing in at the first sign of trouble can be a big mistake.
Get independent financial advice before investing any large lump sum. […]