Many first time investors think that they ought to invest all of their savings. This isn’t necessarily true. To decide how much money you ought to invest, you must first decide how much you actually can afford to invest, & what your financial goals are.
First, let’s take a glance at how much money you can currently afford to invest. Do you have savings that you can use? If so, great! However, you don’t require to cut yourself short when you tie your money up in an investment. What were your savings originally for?
It is important to keep two to two months of living expenses in a readily obtainable savings account – don’t invest that money! Don’t invest any money that you may require to lay your hands on in a rush in the future.
So, start by determining how much of your savings ought to stay in your savings account, & how much can be used for investments. Unless you have money from another source, such as an inheritance that you’ve recently received, this will probably be all that you currently must invest.