Investing for Ordinary Folks with Charles Payne
One of the best ways to build your wealth over time is to invest. Investing can provide you with adequate financial growth to meet your goals. In fact, without it, most ordinary folks can't build a nest egg large enough to see them through retirement.
Watching Charles Payne's program on FOX Business, "Making Money with Charles Payne," is a great way to learn about investing.
Payne hopes the show brings ordinary people a sense of power and confidence, offering the tools that provide a "renewed belief in America and the notion the future can be what they want it to be through investing and self-determination."
The reality is that most of us, especially those in my generation (Generation X) and younger, will need to rely on ourselves to pay for retirement. Gone are company pensions, and Social Security isn't what it used to be. In order to succeed long-term it's important to make the right investing choices now. Payne wants to guide ordinary Americans through the process, and show them how they can make money and build wealth for the long haul.
Now is the time to start investing
The best time to start investing is as soon as possible. "It takes 20 minutes or less to open an account online," Payne says. "Start building a portfolio. Begin with solid names you're comfortable with before trying to hit grand slams."
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Another good option is to start with low-cost index funds. A good, low-cost index fund can help you avoid stock picking until you're a little more comfortable. An index fund is especially great for those who are starting with a small amount of money and might need to use dollar cost averaging to really build a portfolio. With a low-cost, all-market fund, it's possible to start building wealth while you investigate other options and learn more about investing.
Payne hopes that his show will provide the information that ordinary investors can use to make better decisions.
Staying in the game and smoothing the bumps
After the last recession, many people became concerned about the stock market. However, pulling your money out just when the tough times are coming isn't usually the best approach. "Over the last 100 years, nothing has been better," says Payne. "I think it will be the case for the next 100 years."
When it comes to investing for ordinary folks, there really isn't anything much better than the stock market. You have a very real chance of beating inflation over the long haul. But you have to realize that you are in it for the long haul, and invest with that in mind, rather than being blown about by every problem.
In fact, Payne says that you need to stop focusing on the economic storms if you want to be successful. "Economic storms come and go," he points out. "Nobody in their 20s, 30s, 40s, 50s, and even 60s lives their life as if they're dying tomorrow."
Since the stock market has a history of coming out ahead over time, Payne thinks it's a good bet (and I think so, too, for what it's worth). But, Payne also understands that sometimes you need something else to feel comfortable. "A good hedge to help smooth out the bumps is gold," he suggests. He recommends about 10% of your portfolio be exposed to gold to help hedge during the down times. "Hard assets like property and even art or antique watches or collectible guitars can also be good hedge investments."
But you shouldn't get too carried away. The main focus should be on investing in stocks, with the other items as a bit of a hedge to smooth out your personal trend line. "Stay committed," Payne says.
And don't forget to watch his show for more ideas, weekdays at 2 p.m. Eastern.
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