Before you consider investing be sure to have six month’s worth of expenses put away in your emergency fund.
Be free of credit card debt and have a working budget in place that allows you to save money each month.
Only use risk capital for investments. Risk capital refers to money that you can afford to lose without putting you in dangerous financial circumstances.
Have a team of trusted advisors and mentors at your disposal.
Create an overall investment plan and determine how the investment you are considering fits into your plan.
Gain expert knowledge on each specific investment you are considering by conducting due diligence research. Due diligence means you educate yourself on the investment and do your homework before committing your hard-earned money.
Determine the ristk and potential reward. All investments hace a certain amount of risk and reward. Ideally, you want to earn the highest return (reward) with the least amount of risk.
Have an exit plan in place in case the investment doesn’t go as planned.