When it comes to investments it seems like everyone seems to know what they’re talking about. Because there is so much information regularly circulating, there are plenty of opportunities to become misinformed when it comes to how to invest your hard earned money.

Investments can make or break a person’s financial health. When done correctly and patiently, making informed investment decisions can greatly increase your total financial value. When investments are made from an uninformed perspective, a person can lose everything they have.

Before making any sort of investment it’s important to make sure that you are an informed and aware of all of the details. Being prepared makes it easier to deal with any sort of obstacle that comes your way. Preparedness is the key element to anything in life. Particularly when it comes to your finances which can be detrimental if executed poorly.

Here are some of the biggest myths out there when it comes to investments.

401k’s Are The Best Investment For Your Retirement

401k’s were a huge popularity when they first emerged in the 70’s and have been accepted by most people as the standard investment for retirement. Essentially it allows employees to be able to save a portion of each paycheck to be able to go towards funds to be used later in retirement and there are plans in place for what happens to a 401k after death.

A 401k isn’t taxed until it is withdrawn. What many people don’t realize that once they do withdraw their funds, the fees can be extremely high. Make sure that you read all the small print before investing in a 401k. You want the lowest fees possible or you may have made a terrible choice.

There are plenty of other options available and many people invest in annuities as an alternative which guarantees a nice financial cushion in your later years. If this is something you think you might benefit from, then do some research and decide which annuity fits your lifestyle the best.

Of course these aren’t the only two options so it’s always best to speak to a financial advisor if you’re struggling to know which retirement saving plan to use. Alternatively you can do some of your own online research to learn more about different investments for your retirement. There are also online tools that you can use such as this roth ira calculator which helps you calculate the contributions you could be making. This allows you to make an informed decision on the best type of account for you and your savings.

Invest Young Or You Might As Well Not Invest At All

Many people reach their 40’s and 50’s and realize they haven’t made any investments yet and lose hope completely. They figure that if they haven’t made any investments so far, there isn’t any opportunity or reason to make an investment at this point.

This couldn’t be further from the truth. As with many things in life, it’s never too late to start. Many investments can show returns in as little as 3 years.

When it comes to investing later in life it doesn’t have to mean that you have lost your chance.

High Risk Equals High Return

Many people believe that in order to get the highest return on an investment, you have to aggressively go in all or nothing. However, often the best investments are the ones that require patience and have a long history of consistent growth.