When Should I Invest?
“When should I invest?” – Every investor has asked this question at one time or another.
The answer to this question is twofold … And these two answers might surprise you.
The first answer: Since you want to buy low and sell high, the best time to invest is when prices are low. Most investors become timid when prices are low because they fear that prices will fall even further. While this is a risk in investing, it’s also good to remember that you don’t want to buy when prices are high. It’s not that different from when you bought your house: You bought it for as low as you could and you took the risk that prices could go lower. But ideally, you bought it low because you wanted the value of your home to rise. Buying when a stock price is low means you can buy more of it inexpensively. So, if it rises, you can earn a higher profit.
The second answer: The best time to invest is now. Remember the wise saying: “If you want a tree, the best time to plant it was 25 years ago. The second best time is right now.” Savvy investors rarely regret investing; more often than not, they regret not investing. All too often, inexperienced investors want to “time the market” by waiting for the economy to improve before they put their money into something.
Now it’s time to put the answers together: If you want to invest, forget timing the market and waiting for the economy to improve. Instead, carefully choose stocks that are priced low right now but are poised to grow (because they have strong financials and offer a good product or service).