Prior to investing you should...
Draw a personal financial roadmap.
Evaluate your comfort zone and the risks you are taking.
Consider an appropiate mix of investments
Be careful of investing heavily in shares of employer's stock or any individual stock.
Create and maintain an emergency fund.
Pay off high interest credit card debt.
Consider dollar cost averaging.
Take advantage of free money from employer.
Consider rebalancing portfolio ocassionally.
Avoid circumstances that can lead to fraud.
Answer:
Make a financial plan.
Explanation:
When you make a financial plan you determine why, when and what you are saving or investing for. When you think about which goals you want to achieve, you decide either to save either to invest. When you elucidate your current financial situation, you can set your goals and plan the pertinent strategies for it.
