007: Investing Basics with Dustin Granger CFP®

Smart investing is more than just numbers, stocks, and market stats. Investing can help you build the dream you have for your life, live a lifestyle that suits you and helps you to retire one day. It may seem overwhelming, even risky at first, but trust me, you’re Worth It! Dustin and I talk about basic investment options in this episode, so grab a pen! If you have never stopped to calculate exactly what it would cost you, in financial terms, to achieve your desired lifestyle - this is a great place to start!

Owning and lending

Dustin Granger CERTIFIED FINANCIAL PLANNER™ says investing can be simplified down to two concepts, owning something or lending something. In the investment world, if you hear terms like stock, equity or business owner, it is safe to assume that information is being shared from an ownership perspective. “Ownership,” says Dustin, “is the primary way to build wealth.” If you hear terms like bond, debt or fixed income, there is a high likelihood that lending is the focus. Lending to other people may be less risky than owning assets, as there are usually safeguards in place to protect your investment. There is a lot to learn about investing, but it doesn’t have to be overwhelming! Listening to this podcast is a great place to start!

Stock market basics

You don’t have to be a broker on wall street to understand how the stock market works, and how you can begin investing. Dustin Granger CFP® explains that the Dow Jones is, in its simplest form, 30 companies that have been hand-selected to give an overall picture of the economy. The S&P 500 is the same concept, but with 500 companies instead of 30. Each time you buy stock, you buy a tiny slice of that company. For all of the hype, Dustin cautions that the stock market may not always provide an accurate representation of where the economy is on a day to day basis. He compares the Dow Jones to poking your head into the main office of a company every minute to ask them how sales are going. Doesn’t seem effective, right? Over a long period of time, those results will hopefully be increasingly positive, but minute by minute may not provide a clear picture of success. Listen to this episode to hear more from Dustin Granger CERTIFIED FINANCIAL PLANNER™ on stock market planning.

Investment options you can leverage

If you are considering adding to your investment portfolio, there are hundreds of ways to customize how you invest. One strategy will not work for everyone, investing should be specific to your needs and financial goals. Dustin Granger CFP® covers a few of the options in this episode. Mutual funds, exchange-traded funds, commodities, real estate, bonds and certificates of deposit are all possible investment options, each offering their own set of advantages and disadvantages, depending on your goal. If you have been investing for a long time or just starting out, this episode provides great insights you can take to the bank.

Balancing your investment portfolio

As you grow in your knowledge of investing, you may want to maintain a balanced approach, depending on the life stage you are in and your affinity for risk. This simply means that you should think in percentages or add a certain amount of your income towards high-risk investments and a certain amount of income to low-risk or less volatile investments. If you own more, you are assuming a higher risk, because that business could fail, wiping out that investment. Lending, on the other hand, is usually less volatile and may see a better return on investment over time. To hear more from Dustin Granger CERTIFIED FINANCIAL PLANNER™, listen to this episode of Worth it!

Outline of This Episode [6:00] Investing 101 with Dustin Granger CERTIFIED FINANCIAL PLANNER™ [9:00] Owning vs. lending  [13:45] Stock market basics [16:45] Dustin explains mutual funds [18:10] What you should know about Exchange traded funds [20:15] How to invest in commodities [24:0] Real estate as an investment [25:10] Dustin explains bonds [20:45] Why you should consider certificates of deposit (CD) [34:15] Interest rates explained [39:45] How to balance your investment portfolio Resources & People Mentioned Dow Jones S&P 500 Connect With Danielle and Dustin Send us your questions! On Facebook On Twitter

Connect with Dustin on Twitter: @DRGranger