1. Figure out your goals.
When you first start thinking about this, it seems nebulous. It’s often hard to tangibly state what your goals are, especially if you’re young and single. However, you often find that they day you get married, it feels like a flood of goals hit you at once - buying a house, having a child, and so on.

Here’s what to do to get started. Take out a sheet of paper and list every financial goal you have in your life right now. What are you saving for? What would you like to be saving for? Things that might wind up on this list are retirement, your children’s education, a house down payment, complete debt freedom, a car, “walk away from your job” money, money to start a business, and so on. Some of those will be important to you, some won’t, and you may have some that aren’t even listed there. (more…)

1. Pay off your debts.
Clean up your finances before you invest. You are guaranteed to save money on interest when you pay off your bad debt — i.e., using the 7 steps debt elimination plan. On the other hand, there is no guarantee that your investment will make money; especially when you are new at it.
2. Do your homework.
Do not trade until you understand the market and what it has to offer. Learn about investing and the different kinds of investment before you jump in.
3. Know yourself.
Understand your risk tolerance and formulate your investment strategy based on your risk profile, goals, and time horizon.
4. Have a solid strategy.
Did you do 1, 2, and 3 above? Always remain true to your plan and follow the style that works best for you.

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1. Go contrarian: Wall Street is biased, trust no one
The vast majority of business, economic and stock-market forecasters are not looking out for your interests. They’re biased, favoring their employers on Wall Street, Corporate America and Washington. The past few years they made huge bucks hyping the credit/subprime bubble. Witness their bonuses. In 2008 their rosy forecasts will continue. They can’t help misleading you, it’s in their DNA: “Greed is good.”
2. Do-it-yourself: You’ll make fewer mistakes
Remember Buddha’s advice: “Believe nothing, no matter where you read it or who has said it, not even if I have said it, unless it agrees with your own reason and your own common sense.” You are the only “expert” you can trust: All brokers and money managers, newspapers, magazines, online and newsletter pundits, all television anchors, and every other special-interest guru is “selling” you something. Don’t buy “it.” (more…)