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Finance Tips: Investing Advice On How To Allocate Bonds, Cash & Stocks

By Persephone F. Gelson

Why reinvent the wheel? This is a question that new investors should be asking themselves. When first entering the investing world, business financing experts suggest that people follow principles that have been proven in study after study to work. Whether you are embarking on a DIY investing plan or are working with an adviser it is suggested that you first start with a simple investment plan. And if you are working with an over zealous adviser, you should place the burden of proof on them. They should be able to prove that their more complex plan can really get you better long-term returns than a simple plan.

It is often the case that business owners do not have the experience, time, and/or necessary information to make sound investment decisions, according to investing officials. Along with this, they state that business owners tend to be risk takers, but a “risk taker” attitude can be disastrous if you are a new investor. Therefore, business investing experts suggest that new investors act more caution than they may be used to. A bit of risky decision making may be necessary to take businesses to the next level, but it can lead to a whole lot of wasted money when it comes to investing. Business financing gurus state that for new investors it is always best to start with a simple plan. They also state that you should avoid putting all of your eggs in one basket.

Now to get down to the nitty-gritty. These few suggestions will help you get started on your investing ventures. The key to a successful investing plan is proper asset allocation. Business financing officials say that this entails having the right mix of the following three things: bonds, cash, and stocks. Investing companies highly recommend using a portion of your money that you do not think you will need in the short-term for stocks, and a portion of money that you may need in the short-term for bonds. Arizona business financing companies state that a short-term time period is about 5 to 10 years.

If you follow the above advice you will be much less likely to find yourself in a financial bind. Budgeting your money in this way is wise because stocks are much more volatile than bonds. You also do not want to put money that you may need back in a short while into stocks. Investing experts also state that a good tip is to invest in an amount of bonds that is equivalent to your age. They suggest taking your age, let’s say 30, and using that as a percentage of money to use for bonds–30 percent.

Lastly, you must consider how much cash to keep on hand. Cash is a safe asset that is really only affected by inflation. Investing advisers typically suggest that you keep approximately 6 to 12 months of cash. This is a commonly suggested amount of money that serves as a safety net.

Want to find out more about Phoenix small business investing, then visit Persephone F. Gelson’s site on how to choose the best Arizona business financing for your needs.

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Article Citation
MLA Style Citation:
Gelson, Persephone F. "Finance Tips: Investing Advice On How To Allocate Bonds, Cash & Stocks." Finance Tips: Investing Advice On How To Allocate Bonds, Cash & Stocks. 7 Oct. 2010. 3 Aug 2014 <>.

APA Style Citation:
Gelson, P (2010, October 7). Finance Tips: Investing Advice On How To Allocate Bonds, Cash & Stocks. Retrieved August 3, 2014, from

Chicago Style Citation:
Gelson, Persephone F. "Finance Tips: Investing Advice On How To Allocate Bonds, Cash & Stocks"

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