Ensure investing is right for you. Investing money
involves risk, and this includes the risk of permanently losing money. Before
investing money, always ensure you have your basic financial needs taken care
of in the event of a job loss or catastrophic event.Make sure you have 3 to 6
months of your income readily available in a savings account. This ensures that
if you quickly need money, you will not need to rely on selling your stocks.
Even relatively ’safe’ stocks can fluctuate dramatically over time, and there
is always a probability your stock could be below what you bought it for when
you need cash. Ensure your insurance needs are met. Before allocating a portion
of your monthly income to investing, make sure you own proper insurance on your
assets, as well as on your health. Remember to never depend on investment money
to cover any catastrophic event, as investments do fluctuate over time. For
example, if your savings were invested in the stock market in 2008, and you
also needed to spend 6 months off work due to an illness, you would have been
forced to sell your stocks at a potential 50% loss due to the market crash at
the time. By having proper savings and insurance, your basic needs are always
covered regardless of stock market volatility. Nairobi, Kenya
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