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Budgeting 101—The basics of personal finance

Investing like anything else is a skill which has to be learned and the good news is that there are plenty of opportunities to learn it. To begin with it's a good idea to have a plan. Your plan should cover exactly what it is you are investing for. Ok you know you want to invest for the future but exactly when in the future? Think of something as simple as an accident, it doesn't even have to be your fault, and you get hospitalized for a couple of months. Do you think while you're laid there in your hospital bed it's just possible that making the payment for your credit card bill might get forgotten? And what happens when you forget your monthly credit payments? Once you begin to get a good grasp of how the markets operate you can begin to make some investments of your own. However before you start to lay down your hard earned cash you might want to try paper trading. That is where you select a particular stock and decide how much you would like to invest into it but instead of placing an order with a stockbroker you simply record the transaction on paper. Your deposits and withdrawals reflect in your account in real time, so you don t need to wait for them to show in your account. This helps you keep a minute check on the account. Most utility services, credit card payments and other payments can be done by direct money transfer from your online savings account to those services. To answer their question of "what is the first step to investing?" really requires a question in return because it is important to find out the kind of investment they mean. We need to know which types of investment they are considering when they ask "what is the first step to investing? The Bull market which had lasted throughout the 1920s had even led one eminent economist, Irving Fisher, to state that "Stock prices have reached what looks like a permanently high plateau." It seemed at the time that everyone in the nation was obsessed with the stock market and share dealing became the "in thing" to do. 

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