![Investing For Dummies - Paperback | Diverse Reads](http://diversereads.com/cdn/shop/files/9781119716495_p0_v1_s600x595_315x396.jpg?v=1704160566)
Investing For Dummies
- Description
- Product Details
- About the Author
- Read an Excerpt
- Table of Contents
There's nothing better than having your money make more money—and getting to that place isn't as complicated as you've been led to believe. With some common sense, careful planning, and the right advice, you too can watch your money accumulate like it's growing on trees.
In the Ninth Edition of Investing for Dummies, best-selling author and nationally renowned personal finance expert Eric Tyson shows you how to make your money work for you with rock-solid advice that's stood the test of time. Steering clear of flashy get-rich-quick schemes, Tyson offers a slow-and-steady approach that can work for everyone from young professionals just starting their careers to baby boomers who want to bulk up their nest eggs just before retirement.
In the book, you will:
- Get started with investing by exploring your investment choices, weighing risk vs. return, and get your financial house in order
- Discover the parts that stocks, bonds, real estate, and small business can play in your portfolio
- Learn to choose the right periodicals, radio, tv, and web resources that keep you informed and help you avoid the hype
With updated coverage of new developments like the Tax Cuts and Jobs Act and their impact on investments, along with the growing trend amongst brokers toward zero- and low-fee stock trades, the Ninth Edition of Investing For Dummies is the latest can't-miss guide to investing your money like a boss.
ISBN-13: 9781119716495
Media Type: Paperback(9th ed.)
Publisher: Wiley
Publication Date: 11-24-2020
Pages: 464
Product Dimensions: 7.30(w) x 9.00(h) x 1.00(d)
Eric Tyson, MBA, is a financial counselor, syndicated columnist, and the author of bestselling For Dummies books on personal finance, taxes, home buying, and investing.
Read an Excerpt
About This Book 2 Foolish Assumptions 3 Icons Used in This Book 3 Beyond the Book 4 Where to Go from Here 4 Part 1: Getting Started with Investing 5 Chapter 1: Exploring Your Investment Choices 7 Getting Started with Investing 8 Building Wealth with Ownership Investments 9 Entering the stock market 10 Owning real estate 10 Running a small business 11 Generating Income from Lending Investments 13 Considering Cash Equivalents 14 Steering Clear of Futures and Options 15 Passing Up Precious Metals 17 Getting Clobbered in Currencies and Cryptocurrencies 18 Counting Out Collectibles 20 Chapter 2: Weighing Risks and Returns 25 Evaluating Risks 26 Market-value risk 27 Individual-investment risk 32 Purchasing-power risk (also known as inflation risk) 34 Career risk 36 Analyzing Returns 37 The components of total return 37 Savings and money market account returns 39 Bond returns 40 Stock returns 41 Real estate returns 43 Small-business returns 44 Considering Your Goals 45 Chapter 3: Getting Your Financial House in Order 47 Establishing an Emergency Reserve 48 Evaluating Your Debts 50 Conquering consumer debt 50 Mitigating your mortgage 51 Establishing Your Financial Goals 53 Tracking your savings rate 53 Determining your investment tastes 56 Funding Your Retirement Accounts 56 Gaining tax benefits 56 Starting your savings sooner 57 Checking out retirement account options 61 Choosing retirement account investments 63 Taming Your Taxes in Non-Retirement Accounts 64 Figuring out your tax bracket 64 Knowing what’s taxed and when to worry 65 Choosing the Right Investment Mix 67 Considering your age 67 Making the most of your investment options 68 Easing into risk: Dollar cost averaging 69 Treading Carefully When Investing for College 71 Education Savings Accounts 72 Section 529 plans 73 Allocating college investments 73 Protecting Your Assets 75 Part 2: Stocks, Bonds, and Wall Street 77 Chapter 4: The Workings of Stock and Bond Markets 79 How Companies Raise Money through the Financial Markets 79 Deciding whether to issue stocks or bonds 80 Taking a company public: Understanding IPOs 81 Understanding Financial Markets and Economics 84 Driving stock prices through earnings 84 Weighing whether markets are efficient 85 Moving the market: Interest rates, inflation, and the Federal Reserve 86 Chapter 5: Building Wealth with Stocks 93 Taking Stock of How You Make Money 94 Defining “The Market” 94 Looking at major stock market indexes 95 Counting reasons to use indexes 98 Stock-Buying Methods 98 Buying stocks via mutual funds and exchange-traded funds 99 Using hedge funds 100 Selecting individual stocks yourself 101 Spotting the Right Times to Buy and Sell 102 Calculating price-earnings ratios 103 Citing times of speculative excess 104 Buying more when stocks are “on sale” 111 Avoiding Problematic Stock-Buying Practices 114 Beware of broker conflicts of interest 114 Don’t short-term trade or try to time the market 115 Be wary of gurus 117 Shun penny stocks 119 The Keys to Stock Market Success 120 Chapter 6: Investigating and Purchasing Individual Stocks 123 Building on Others’ Research 124 Discovering the Value Line Investment Survey 124 Considering independent brokerage research 129 Examining successful money managers’ stock picks 130 Reviewing financial publications and websites 131 Understanding Annual Reports 131 Financial and business highlights 133 Balance sheet 133 Income statement 136 Exploring Other Useful Corporate Reports 139 10-Ks 140 10-Qs 140 Proxies 140 Getting Ready to Invest in Stocks 141 Understanding stock prices 142 Purchasing stock “direct” from companies 144 Placing your trade through a broker 144 Chapter 7: Exploring Bonds and Other Lending Investments 147 Banks: Considering the Cost of Feeling Secure 148 Facing the realities of bank insurance 149 Online banking: More for you? 149 Being wary of the certificate of deposit (CD) 151 Swapping your savings account for a money market fund 152 Why Bother with Bonds? 155 Assessing the Different Types of Bonds 156 Determining when you get your money back: Maturity matters 157 Weighing the likelihood of default 158 Examining the issuers (and tax implications) 159 Buying Bonds 162 Deciding between individual bonds and bond funds 162 Understanding bond prices 163 Purchasing Treasuries 164 Shopping for other individual bonds 165 Considering Other Lending Investments 166 Guaranteed-investment contracts 167 Private mortgages 168 Chapter 8: Mastering Mutual Funds and Exchange-Traded Funds 171 Distinguishing between Mutual Funds and Exchange-Traded Funds 172 Discovering the Benefits of the Best Funds 172 Professional management 173 Cost efficiency 173 Diversification 174 Reasonable investment minimums 174 Different funds for different folks 174 High financial safety 175 Accessibility 175 Reviewing the Keys to Successful Fund Investing 176 Minimize costs 176 Reflect on performance and risk 179 Stick with experience 180 Consider index funds 180 Steer clear of leveraged and inverse exchange-traded funds 182 Creating Your Fund Portfolio with Asset Allocation 183 Allocating for the long term 184 Diversifying your stock fund investments 185 The Best Stock Funds 186 Making money with stock funds 187 Exploring different types of stock funds 188 The Best Bond Funds 193 Avoiding yield-related missteps 194 Treading carefully with actively managed bond funds 195 Stabilizing your portfolio by investing in short-term bond funds 196 Earning higher returns with intermediate-term bond funds 197 Using long-term bond funds to invest aggressively 199 Balanced and Asset Allocation Funds: The Best Hybrid Funds 200 The Best Money Market Funds 201 Taxable money market funds 203 U.S Treasury money market funds 203 Municipal money market funds 203 Chapter 9: Choosing a Brokerage Firm 205 Getting Your Money’s Worth: Discount Brokers 205 Assessing the high-commission salespeople’s arguments 207 Selecting a discount broker 207 Considering Online Brokerage Services 210 Examining your online trading motives 210 Taking other costs into account 211 Looking at service quality 212 Listing the best online brokers 213 Part 3: Growing Wealth with Real Estate 215 Chapter 10: Investing in a Home 217 Considering How Home Ownership Can Help You Achieve Your Financial Goals 218 The Buying Decision 218 Weighing the pros and cons of ownership 219 Recouping transaction costs 222 Deciding How Much to Spend 223 Looking through lenders’ eyes 225 Determining your down payment 225 Selecting Your Property Type 226 Finding the Right Property and Location 228 Keeping an open mind 229 Research, research, research 229 Understanding market value 230 Pounding the pavement 231 Chapter 11: Investing in Real Estate 233 Discussing Real Estate Investment Attractions 234 Limited land 234 Leverage 234 Appreciation and income 235 Ability to add value 236 Ego gratification 237 Longer-term focus 237 Figuring Out Who Should Avoid Real Estate Investing 239 Examining Simple, Profitable Real Estate Investments 239 Finding a place to call home 240 Trying out real estate investment trusts 241 Evaluating Direct Property Investments 242 Residential housing 242 Land 244 Commercial real estate 245 Deciding Where and What to Buy 246 Considering economic issues 246 Taking a look at the real estate market 247 Examining property valuation and financial projections 249 Discovering the information you need 254 Digging for a Good Deal 255 Recognizing Inferior Real Estate “Investments” 257 Avoiding ticking timeshares 257 Staying away from limited partnerships 259 Ignoring hucksters and scams 259 Chapter 12: Real Estate Financing and Deal Making 263 Financing Your Real Estate Investments 263 Getting your loan approved 264 Comparing fixed-rate with adjustable-rate mortgages 267 Choosing between fixed and adjustable mortgages 269 Landing a great fixed-rate mortgage 270 Finding a suitable adjustable-rate mortgage 271 Examining other mortgage fees 275 Finding the best lenders 276 Refinancing for a better deal 277 Working with Real Estate Agents 279 Recognizing agent conflicts of interest 279 Selecting a good agent 280 Closing the Deal 282 Negotiating 101 282 Inspecting the property 283 Shopping for title insurance and escrow services 284 Selling Real Estate 285 Negotiating real estate agents’ contracts 286 Forgoing a real estate agent 287 Part 4: Savoring Small Business 289 Chapter 13: Assessing Your Appetite for Small Business 291 Testing Your Entrepreneurial IQ 292 Considering Alternative Routes to Owning a Small Business 295 Being an entrepreneur inside a company 295 Investing in your career 296 Exploring Small-Business Investment Options 297 Starting your own business 297 Buying an existing business 298 Investing in someone else’s business 298 Drawing Up Your Business Plan 300 Identifying your business concept 301 Outlining your objectives 303 Analyzing the marketplace 304 Delivering your service or product 306 Marketing your service or product 307 Organizing and staffing your business 308 Projecting finances 308 Writing an executive summary 311 Chapter 14: Starting and Running a Small Business 313 Starting Up: Your Preflight Checklist 314 Preparing to leave your job 314 Valuing and replacing your benefits 315 Financing Your Business 318 Going it alone by bootstrapping 318 Taking loans from banks and other outside sources 319 Borrowing from family and friends 321 Courting investors and selling equity 322 Deciding Whether to Incorporate 323 Looking for liability protection 324 Taking advantage of tax-deductible insurance and other benefits 324 Cashing in on corporate taxes 325 Making the decision to incorporate 326 Finding and Keeping Customers 327 Obtaining a following 327 Providing solid customer service 328 Setting Up Shop 329 Finding business space and negotiating a lease 329 Equipping your business space 331 Accounting for the Money 332 Maintaining tax records and payments 333 Paying lower taxes (legally) 335 Keeping a Life and Perspective 336 Chapter 15: Purchasing a Small Business 337 Examining the Advantages of Buying 337 Understanding the Drawbacks of Buying 339 Prerequisites to Buying a Business 340 Business experience 340 Financial resources 341 Focusing Your Search for a Business to Buy 341 Perusing publications 343 Networking with advisors 343 Knocking on some doors 343 Working with business brokers 344 Considering a Franchise or Multilevel Marketing Company 346 Finding a franchise 346 Considering a multilevel marketing company 348 Evaluating a Small Business 351 Doing due diligence 351 Determining a business’s value 353 Part 5: Investing Resources 355 Chapter 16: Selecting Investing Resources Wisely 357 Dealing with Information Overload 358 Separating Financial Fact from Fiction 360 Understanding how advertising corrupts the quality of investment advice 360 Recognizing quality resources 362 Chapter 17: From Print to Podcast to Programs: Making Your Way through Various Financial Mediums 367 In Print: Magazines and Newspapers 367 Judging the journalists 368 Making the most of periodicals 370 Broadcasting Hype: Radio, Podcasts, and Television Programs 371 You often get what you pay for 371 Information and hype overload 372 Poor method of guest selection 372 Fillers and Fluff: Being Wary of Investment Newsletters 373 Chapter 18: Selecting the Best Investment Books 375 Being Wary of Infomercial Books 376 Understanding how authors may take advantage of you 376 Learning by example 376 Ignoring Unaudited Performance Claims 379 Investing Books Worth Reading 381 A Random Walk Down Wall Street 381 Stocks for the Long Run 382 Built to Last and Good to Great 382 Mutual Funds For Dummies 383 Chapter 19: Investigating Internet and Software Resources 385 Evaluating Investment Software 386 Taking a look at investment tracking software 386 Considering investment research software 389 Investigating Internet Resources 391 Assessing online resources 391 Picking the best investment websites 393 Part 6: The Part of Tens 397 Chapter 20: Ten Investing Obstacles to Conquer 399 Trusting Authority 399 Getting Swept Up by Euphoria 400 Being Overconfident 401 Giving Up When Things Look Bleak 401 Refusing to Accept a Loss 403 Overmonitoring Your Investments 403 Being Unclear about Your Goals 404 Ignoring Important Financial Problems 404 Overemphasizing Certain Risks 405 Believing in Gurus 406 Chapter 21: Ten Things to Weigh When Considering an Investment Sale 407 Remembering Preferences and Goals 407 Maintaining Balance in Your Portfolio 408 Deciding Which Ones Are Keepers 409 Tuning In to the Tax Consequences 409 Figuring Out What Shares Cost 410 Selling Investments with Hefty Profits 411 Cutting Your (Securities) Losses 412 Dealing with Unknown Costs 412 Recognizing Broker Differences 413 Finding a Trustworthy Financial Advisor 413 Chapter 22: Ten Tips for Investing in a Down Stock Market 415 Don’t Panic 415 Keep Your Portfolio’s Perspective in Mind 416 View Major Declines as Sales 417 Identify Your Portfolio’s Problems 418 Avoid Growth Stocks If You Get Queasy Easily 418 Tune Out Negative, Hyped Media 419 Ignore Large Point Declines but Consider the Percentages 419 Don’t Believe You Need a Rich Dad to Be a Successful Investor 419 Understand the Financial Markets 420 Talk to People Who Care about You 421 Index 423Table of Contents
Introduction 1