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But whether youve never invested before or youve dabbled, youll want to be strategic about it.
After all, youve already reached a major milestone in having that much cash to spare.
Youll want to make it count.
Keeping in mind that everyones journey and goals are different, heres what they suggested.
Also see ways to invest against high inflation, according to a financial advisor.
Set Some Goals
Start by setting some personal goals.
Decide what you want from your investment, Rynsburger said.
Having goals can help you get and stay on track with what you want to do.
Its okay to start small.
After all, you dont have to achieve your goals tomorrow oreven next year.
The key is to have a clear idea of what you want to accomplish.
Its easier to set goals if you have a timeline.
The first thing to do is to determine your time horizon, Johnson said.
Acknowledge how much risk you’ve got the option to tolerate, Rynsburger said.
As a general rule of thumb, investments with higher returns also have higher risks attached to them.
But the opposite is also true.
The stock market, meanwhile, tends to have higher returns but also higher short-term risk.
In other words, spread out your $5,000 indifferent investment vehicles.
If youre not sure the best areas to invest, do some research or consult a professional.
And as always, it’s possible for you to start small.
This can also help you determine your own risk tolerance.
Theyre not for everyone, but they do have their advantages.
In particular, Rynsburger pointed out that they can be cheaper than other investment management services.
But youll also want to go back and review your portfolio every now and then.
Review your investments regularly and make necessary changes in portfolio rebalancing, Rynsburger said.
This keeps the investment strategy in line withboth market conditionsand personal desires.
Say, for example, your risk tolerance has changed.
You may want to invest in assets that offer higher or lower risk depending on your preferences and goals.
You may also want to make changes or even those initial investments based on your timeline.
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