10 Slam-Dunk Investment Tips For 2010

By: Joe Andrews

Break Studios Contributing Writer

Are you looking for ten slam-dunk investment tips for 2010? After the last few roller coaster years, you’re not alone. Here’s a list of ten ideas that’ll make 2010 a banner year for your portfolio.

Remember the high interest rate money market. Nothing says scary like the 2000-2010 period of investing. Having a reserve for emergencies ensures you’ll weather storms in the financial markets, while others are worried about where the next dollar is going to come from.
Pay attention to fees. The Securities and Exchange Commission (SEC) warns that even if your investments lose money, mutual funds will continue to charge based on the value of the account. It doesn’t take a rocket scientist to realize that if investment fees are lower there will be less drag on portfolio returns.
Remember taxes. Even if you don’t trade a mutual fund a manager might trade on your behalf, creating a tax bite. When considering a non-IRA mutual fund, review the turnover”of investments inside the account. This statistic details how often the manager trades, possibly leaving you with a tax day surprise.
Stay diversified. Over the last ten years, technology, real estate, gold, money market funds, stocks, and bonds have all had faltered. Diversification among many asset classes can be a slam dunk because it assures you that risks are spread out, narrowing the chance that all investments will sink together.
Track your investments. Keeping track of the market on television or the newspaper doesn’t tell you if your funds are competitive or not.
Explore alternative investments. Stocks, bonds, and cash were investment types heavily recommended prior to the roller coaster years. Asset classes such as gold and real estate, used sparingly, can broaden the diversification of a portfolio and help avoid pitfalls of having too many eggs in one basket.
Complete your financial plan. Knowing what return you need and how much to invest acts like a rudder when making investment decisions.
Use your 401k or 403b plan at work. Giving yourself a tax shelter is a huge slam dunk opportunity. If you aren’t using your company retirement plan, what are you waiting for? Money invested enters the plan “pre-tax," meaning that you won’t pay tax until you take it out during retirement years.
Flip money to a Roth IRA. In 2010 many of the rules of Roth IRAs have changed, making it easier this year to move money into a Roth IRA and grow it tax free.
Invest in your education. A huge slam dunk is investing in you. As baby boomers retire, the need for jobs in health care and financial planning will widen and the competition for quality jobs is only expected to increase.