U.S.

June 27, 2013

Generate earnings: It pays to invest

Airman 1st Class Grace Lee
56th Fighter Wing Public Affairs

LUKE AIR FORCE BASE, Ariz. — Though it’s impossible for money to grow on trees, by investing and with time it can multiply.

An investment is the commitment of money or capital used to purchase financial instruments or other assets to gain profits in the form of interest, income or appreciation, said James Knuckles, 56th Force Support Squadron Airman and Family Readiness Center community readiness consultant.

“Due to compounding, investing transforms your working money into a state-of-the-art, highly powerful income-generating tool,” said Cory Carmichael, 56th FSS A&FRC community readiness consultant. “Compounding is the process of generating earnings on an asset’s reinvested earnings.”

Compounding requires two things to work, time and the reinvestment of earnings. The more time given, the more the amount of income will be able to accelerate and grow.

What about reinvestment of earnings?

Investments come in many forms, Carmichael said. They vary from conservative safe bonds, mutual funds and stocks to riskier alternative investments. A person’s investment should mirror their willingness to risk their money and financial goals.

A few other types of investments include real estate, gold and futures, which are contracts that attempt to predict the value of securities on merchandise, currencies and the stock market, Knuckles said.

You can also invest in a Thrift Savings Plan, Individual Retirement Account or a 401(k), Carmichael said. Many service members favor the TSP due to the choice of index funds, low costs and the asset allocated lifecycle fund.

Carmichael advises to invest at least 10 percent of your income.

“I like to say, ‘save until it hurts,’ but at the least, invest 10 percent of your income,” he said. “Remember that you are investing in your future. However, if you are living with any consumer debt or lack an emergency fund of at least three months of living expenses, then that should be a priority.”

It’s recommended to diversify investments to mitigate the risk of financial loss.

“Diversifying your investments is similar to the practice of ‘not putting all your eggs in one basket,’” Carmichael said. “If you spread your investments across various types of assets and markets, you’ll reduce the risk of catastrophic financial losses, since different securities perform differently at any one point in time.”

To be financially successful Carmichael recommends investing early in life and regularly, and staying invested.

“For every five years you delay investing, you will have to double your monthly investment amount to achieve the same goals,” he said. “Remember, you and no one else are responsible for your own financial success.”




All of this week's top headlines to your email every Friday.


 
 

 

Just American: A century of Black life

COLUMBUS AIR FORCE BASE, Miss. (AFNS) — Black History Month, or National African American History Month, is an annual celebration of achievements by black Americans and a time for recognizing the central role of African Americans in U.S. history. The event grew out of “Negro History Week,” the brainchild of noted Harvard-trained historian Carter Woodson....
 
 

Pay dates increase for civilians in 2015

JOINT BASE SAN ANTONIO-RANDOLPH, Texas (AFNS) — Civilian employees will have 27 pay dates in 2015 compared to the usual 26, so some employees might need to adjust their Thrift Savings Plan (TSP) contribution elections to receive the maximum agency matching contributions for 2015. The Internal Revenue Code imposes a limit each year on the...
 
 
DT_pict4

Combat Search and Rescue: A Legacy Continues

An HH-60 Pave Hawk hovers 200 feet above the ground with a 600-pound load during a weight check at Camp Lemonnier, Djibouti on Jan. 26. The weight check was to make sure the hoist was operational after being repaired. Master Sg...
 

 

Iraqi Security Forces repel ISIL attack

WASHINGTON – An attempt by 20 to 25 Islamic State of Iraq and the Levant fighters to attack al Asad Air Base in Iraq was repulsed by “ready and able” Iraqi security forces, the Pentagon press secretary said today. “The attempted attack was led, we believe, by at least several … suicide attackers,” Navy Rear...
 
 

Obama sends resolution for use of force against ISIL to Congress

WASHINGTON – President Barack Obama has sent a draft resolution to Congress to authorize the use of force against the Islamic State of Iraq and the Levant. The president spoke about the draft authorization during a White House announcement this afternoon. Vice President Joe Biden, Defense Secretary Chuck Hagel and Secretary of State John Kerry...
 
 

Exchange shoppers have chance at $10,000 grand prize

DALLAS – A $10,000 grand prize is up for grabs in the Army & Air Force Exchange Service’s latest “Because of You” contest. And, for authorized shoppers, entering is as easy as visiting shopmyexchange.com. With the Spend Free Spree contest, military shoppers have a chance to win a $10,000 Exchange gift card, or a $2,000 gift...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>


Directory powered by Business Directory Plugin