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16 Sep 2011

Rocky Start at Stocks, Bonds and Funds

I am trying to get my claws deep in the alternative forms of investment. I know I actually waste a lot of time on the education part of everything, but it always pays off.  I think. For a long time, the words shares, stocks, funds, etc, scared me. That's the main reason I started to even consider them as an investment alternative, late in my life.

My very first glimpse at the stocks was when  was 28 or 29, just married and living in a 2 bedroom apartment with my new hubby. I remember how excited he was to start trading in the stock exchange when a guy who called and came for a visit to explain this to us. The guy was actually selling a software which made it "too easy" to be rich. The software does everything and actually indicates the perfect time for you to buy or sell shares. It was just a "miracle". Being gullible and naive, I never stopped and wondered why the guy is in my apartment in the early hours of the evening, teaching us how some software works, instead of using it in the comfort of his mansion, making money.

Hubby was sold and fascinated by this. I was too, but I was not about to play the "scary game", not unless I get some training. I know, I am stiff like that. I had my first apartment making me a comfortable rent check every month and a job that was taking me nowhere slowly financially. In all, this was a perfect solution for our young family to start on a journey to wealth. The software was not cheap, but it was worth it....so we thought at the time.

The Rocky Start
None of us understood the stocks well enough to actually be confident enough to let money go. We actually didnt have enough of money to be investing. I was pregnant and all I was thinking of, was having a house with the garden in the suburbs to be able to raise my child. And yes, it felt wrong to raise a child in that apartment, without a garden for my son to play. I look back and shake my head. We did buy the house with a huge garden, which was a pain to maintain. *side-note* But at the end we got good profits from the sale of the house when we moved to the smaller home.

The project failed but we still had to pay the software guys for 3 years, monthly. Can you imagine the pain. But we did learn a lesson. So bad learning from your mistake. By this time I knew that I have to give the playing in the stock exchange to experts.

My Tiny Stocks Portfolio
I then started buying into funds in 2005. Off course I wanted nothing to do with the day-to-day business of buying and selling shares. Actually it was so bad that, I have various accounts handled by various groups of financial gurus, but I never even bothered to check how the individual shares performed. I was not interested and it was not necessary because I was paying people to do it...so ignorant.

This blog is my personal finance conscience in black and white. The moment I started it, I woke up to my over-spending and relaxed investing attitude. I spent the whole decade focusing on my real estate investments. I am thrilled that it pays my bills, but I think I am ready for more.

My new "Stocks, Bonds and Funds"  Plan goes:
The plan for the emergency fund goes out the window... sort of. I reckon I have access to enough "cheap cash", which can serve as an emergency fund. I love liquidity but not that much. My access bond is great for that. **Access bond is a type of mortgage that permits borrowers to take out loans against extra capital paid into the account, home-loan interest rates being lower than interest rates on other forms of credit.** SO we have overpaid on our one mortgage so that we save on the interest, whilst the extra money is also available should we need it. That's perfect as a cushion for the property emergency fund. That's a lot more than I'll ever need at one time. So emergency fund, sorted.

The $300+ that I was planning to use to build the emergency fund will then be redirected to the stocks, bonds, funds, and whatever clever people call them. Watch me fly now and growing that net worth from October 1. No regrets for taking this long.

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