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Investing Basics

November 5, 2019 If you're already really good at saving, the next smart step is to put your money somewhere it can really grow. Yep, that means investing. Getting your portfolio on. With Summit Financial Advisors ready to help, you've got this. And get this you don't need to have a lot of money or take big risks to get into investing.

You Can Start Small

All it takes to become an investor is a small sum that's not already set aside for other financial obligations – or a little bit off the top of each paycheck. The only big thing you'll need is a goal. Saving for education, a down payment on a house or for retirement are all good reasons to start investing.

You Can Choose Your Risk Level

Different investments carry different risks, from losing it all to barely outpacing the average savings account. Like most investors, your tolerance for risk – and desire for reward – is probably somewhere in the middle. Summit Financial Advisors can help you determine the investment strategies that fit your life stage, your savings goals and your well-being. In the meantime, here are some investing basics:

Stocks vs Bonds

Buying stock, or shares, in a company means you own a portion of that company. When it makes money, your shares are worth more. When it loses money, your shares decrease in value. In general, stocks carry greater risk, but with higher reward potential. With bonds, you're loaning money to a company or government entity, which it pays back with interest. Bonds tend to be a lower-risk investment but also tend to return lower earnings. Investment tip: Diversifying your portfolio with a mix of stocks and bonds can help dial in the risk-reward you're looking for. Diversification does not ensure a profit or guarantee against a loss. Investing in mutual funds is one way to do just that.

Mutual Funds

A mutual fund is a professionally managed portfolio of stocks and/or bonds selected for a specific investment strategy, such a low-risk, stable growth or high-risk, high-reward potential. The right combination of mutual funds should put you right in your comfort zone. Value-based investing: You can even choose mutual funds that align with your values, such as sustainability or social responsibility.
You may be familiar with mutual funds from your employer's 401(k) or 403(b) retirement plan. Did you know mutual funds are an investment option outside of work as well?

Traditional and Roth IRAs

An IRA, or individual retirement account, isn't actually an investment. Think of it as a home for your investments – your mutual funds*, for example. Traditional IRA (Pay taxes later) or Roth IRA (Pay taxes now) You can whenever you're ready. And each has its own advantages, with the Roth option acting as a nice complement to your 401(k) because it's funded with after-tax dollars. Plus, you're allowed to access your Roth IRA contribution (and sometimes even your earnings) anytime without penalty. Good to know in case something comes up.

You Can See Growth Over Time

It's so satisfying to watch your investments grow. Hooray for compound interest! The sooner you start investing, even conservatively, the longer your money will have to see growth.

You Can Begin Here and Now

Schedule a meeting with a to get started today! It's also a good idea to look into higher impact savings options like a Money Market or Certificate to grow your money bigger and faster. Summit can help with that too. *Investing in mutual funds involves risk, including possible loss of principal. Fund value will fluctuate with market conditions and it may not achieve its investment objective. Securities and advisory services are offered through LPL Financial (LPL), a registered investment advisor and broker-dealer (member FINRA/SIPC). Insurance products are offered through LPL or its licensed affiliates. Summit Credit Union and Summit Financial Advisors are not registered as a broker-dealer or investment advisor. Registered representatives of LPL offer products and services using Summit Financial Advisors and may also be employees of Summit Credit Union. These products and services are being offered through LPL or its affiliates, which are separate entities from, and not affiliates of, Summit Credit Union or Summit Financial Advisors. Securities and insurance offered through LPL, or its affiliates are: Not Insured by NCUA or Any Other Government Agency Not Credit Union Guaranteed Not Credit Union Deposits or Obligations May Lose Value Summit Credit Union (“Financial Institution”) provides referrals to financial professionals of LPL Financial LLC (“LPL”) pursuant to an agreement that allows LPL to pay the Financial Institution for these referrals. This creates an incentive for the Financial Institution to make these referrals, resulting in a conflict of interest. The Financial Institution is not a current client of LPL for advisory services. Please visit or more detailed information. You might also be interested in A review of Q1 2022, Presented by . A review of Q4 2021, Presented by . Have you considered investing? If you're already really good at saving, the next smart step is to put your money somewhere it can really grow. Yep, that means investing. Getting your portfolio on. With Summit Financial Advisors ready to help, you've got this. Planning for marriage should involve more than just picking out invitations and deciding whether you should serve chicken or fish at the reception. More importantly, you'll want to take a look at how marriage will impact your financial situation. Are you marrying soon? Have you recently married? As you begin your life together, it is important for you to start planning your financial future together and putting your finances on the same page. Here are some priorities you might want to write down on your financial to-do list. There’s no time like the present to start financial planning for your future. Give yourself peace of mind with these financing tips for saving and investing and learn how to start saving money now. A message from Summit Financial Advisors Since the financial crisis of 2008 we’ve seen year after year of steady market recovery, and 2014 delivered more records for equity returns. Many people have scored attractive investment gains as a result. But when it comes to the stock market, it’s wise to remember that the momentum of the game can turn around and a bear can quickly replace the bull on the field. So, what would a major drop in the stock market do to your retirement game plan? 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