Commentary

June 21, 2013

It pays to invest

Pg-11-It-pays-to-invest-photo
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.”

For more information on investing or other financial needs, call A&FRC at 623-856-6550. The A&FRC, in addition to having trained financial counselors, has free publications, guides, classes and other resources to answer questions concerning finance. One-on-one appointments are also available.




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


 
 

 
Pg-1-Standalone---140411-F-HT977-026

Weather: Exercise component

First responders prepare to transport a simulated injured patient during an extreme weather exercise April 11 at Luke Air Force Base. The exercise was designed to train and evaluate Luke Airmen on readiness and preparation for ...
 
 
Courtesy photo

Plane crash, coma doesn’t deter pilot

Courtesy photo Retired Capt. David Berling, 56th Contracting Squadron contract specialist, stands in front of his 1977 Cessna RG March 23, 2012, at the Glendale Airport. Berling lost his legs in a 2007 plane crash, the subject ...
 
 

Comprehensive support system helps unit resiliency

In today’s Air Force environment of force restructure, budgetary constraints, continued mission requirements and resiliency, establishing a comprehensive support system in a unit is absolutely essential for success. Each organizational tier, whether at the element, flight or squadron level, must be resilient and have support mechanisms in place to not only meet, but exceed daily...
 

 

Preparing for next rank makes successful Airmen

As Airmen we have many responsibilities and duties we must carry out in accordance with our jobs. According to AFI 36-2618, The Enlisted Force Structure, our responsibilities are as follows: junior enlisted Airmen initially focus on adapting to military requirements, achieving occupational proficiency and learning how to become highly productive members of the Air Force....
 
 
Senior Airman
JASON COLBERT

Energy office helps keep lights on

Senior AirmanJASON COLBERT Master Sgt. Adam Kelley, 56th Civil Engineer Squadron base energy manager, explains the value of low wattage light bulbs to Robert Wimp at the Energy Conservation Month booth April 9 at Luke Air Force...
 
 

News Briefs April 18, 2014

Change of command Lt. Col. Jon Wheeler relinquishes command of the 310th Fighter Squadron to Lt. Col. Matthew Warner at 8:31 a.m. today in Hangar 913. Days of Remembrance The 2014 Days of Remembrance of the Holocaust Victims is May 2 at Club Five Six. A Holocaust exhibit of masks of holocaust survivors and paintings...
 




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