Chapter 14
Taking Reasonable Investment Risks
IN THIS CHAPTER
Getting a handle on investing basics
Taking the plunge during a downturn
Recognizing risk
Realizing that risk and reward go hand in hand
Finding your risk tolerance
The whole reason you invest your money is so it can earn more money. Otherwise, you may as well just lock your savings up in a safe. (Of course, inflation would eat away at the value of your money while it sits in the safe. So investing your money is really your best bet.)
The bad news is that investing money involves a certain amount of risk. The good news is that you can use this risk to your advantage and score a higher return on your money.
Like many things, investment risk isn’t that scary after you understand it. This chapter explains the different types of risk involved with your 401(k) and IRA investments. The goal is not to frighten you away from investing but to make you comfortable by familiarizing you with the unfamiliar. After all, the key to successful ...
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