Better Safe than Sorry, I DON'T THINK SO!

Stocks can be very volatile and has the tendency to fluctuate a lot during a short period of time. Due to this volatility, people insist that investing in stocks is a dangerous thing to do when investing for the future. Everyone prefers to choose the safe and cautious savings bonds to invest their money. Stocks are wild and dangerous, while Bonds are boring and safe. It's like comparing me to my grandparents.

However, no matter how wild stocks may be they almost always turn out to produce the best investment returns in history, helping many people become millionaires.

The only reason stocks can be a bad investment choice, is when your saving for the short term. Stocks fluctuate so much that it is extremely difficult to predict if your stock will increase in value during a short period of time. But if you are planning to save for the long term, stocks are by far the best performing investment vehicle.

If you are planning to save money that won’t be needed in at least a couple of years or more, than investing in stocks is the best place to achieve substantial returns.

Now be careful, diversification is very important, and I wouldn’t recommend anyone putting all their money into stocks. There is a saying that goes “don’t put all your eggs in one basket,” which means if something unexpected happens to the stock market you don’t want to be stuck with all your savings invested in the market. I’ll talk about diversification and asset allocation later on.

But first I need to encourage you to begin investing in stocks. Stocks have always been the best performing investment in recent history.

Here’s a chart comparing the annual returns of the stock market compared to savings bonds over the past 30 years:

As you can see the stock market returns were very unstable, but they still provided excellent returns almost every year.

The average annual stock market return for the past 30 years was 13.75%, while the average annual savings bond only returned 6.15%.

If you had invested $1000 back in 1976 into stocks you would have $47,403 by the end of 2006.

If you had invested the $1000 in bonds you would only have $5992 by the end of 2006.

Stocks offer the best returns and should not be ignored when investing for the future. I will eventually show how you can get even bigger returns if you learn how to discover and find great investment opportunities.

Remember stocks are volatile in the short term, but in the long term you will always be better off invested in stocks. Don’t be scared, know what you're doing and be prepared to stay invest for at least a couple of years. Investing in stocks may seem like a wild choice, but honestly it may be the greatest financial choice you make.

Be young and wild, start investing in stocks now!