In this computer age, everyone is looking for fast money! We want a business we can start right now and have our capital doubled within few days! And there are so many of such businesses out there right now, businesses that will promise you 700% of your investment within few days. I wouldn’t blame you if that’s what you want. We have bills to pay and financial targets to meet. We don’t want to imagine facing the consequences of failing to meet up. And so what do we do? We look for opportunities that can solve these problems in record time.
But before you plunge into these business opportunities, before you commit your hard earned money, you may need to consider some of these mistakes we tend to make when investing. As we scavenge for opportunities which can double or even triple our finances, you should not make some of these mistakes I have highlighted or else, you may end up getting yourself into a serious situation you did not prepare for!
1. Poor Knowledge of the Business:
What do you know about the business you want to invest in? Don’t just take their word for it, find out if they are living up to their name. Don’t assume you know what they are doing, be sure! It is your money we are talking about here, you want to hand it over to complete strangers with the hope that they would help you make some money, you need to know everything possible about their investment plan first. Are they a registered company? Who is the CEO and do they have a traceable location? If they do, you want to pay them a visit or get someone to visit them on your behalf?
What is their track record in business? You want to know how long they have been in business! A 2yr-old company is too young to invest in. Based on my recommendation, 5years is the minimum you should consider if you want to invest in any company at all. Anything less is putting your hard earned money on a crazy risk!
2. Taking Emotional Decisions:
There are a few times you should not take any major financial decision:
- When you are too excited: because of the joy, you can overlook a lot of things and end up making terrible mistakes
- When you are too sad: because of the sadness, you just want to get over it and move on. You are prone to making serious mistakes. Don’t take a major decision, not even an investment decision when you are sad.
- When you are hungry: you will be amazed what evil hunger can arbor, you become vulnerable. If you are hungry, eat and get some rest before you take step towards investing.
- When you are broke: a broke man will accept anything just to get what he wants. You are vulnerable when you are broke. Even though you may be broke, never allow it to cloud your investment decisions.
- When you have a financial deadline: you have a financial emergency and you want to do something quickly to yield money for you so you could meet your financial deadline. Often times you end up putting yourself in serious financial problems if you invest at such times. It is taking an investment decision under duress!
Emotional decisions also come in when you take major financial decisions because someone you love told you it’s a good deal. I once hired someone to run a business for me based on the fact that he was introduced to me by someone I love and respect. After 11 months, we didn’t make any profit and we lost all the capital. I had to sell the equipment very cheap afterwards. All these would have been avoided if I had equipped someone who could do the job instead of employing someone who knew nothing about the job but employed him anyway just because he was recommended by someone I love and respect. Emotional decision could also be made if the person running the business you want to invest in is a family, a friend or someone you respect. Do not allow your emotions to be involved in your business decision making to avoid stories that touch.
3. Damning Reviews:
There is almost always an information to read on the internet about the business you want to invest in or something similar to it. Before you get committed to any investment program, see what others are saying about it. Make a search on search engines online to see what people are saying about them. You will find answers, comments and reviews from people who are using the service or who have used the service. Do not ignore them! If you have a single negative comment from a user of that program, it is enough a red flag. However, there are reviews that are bias. Some of these people who write reviews may not have actually tested the sites personally. Some base their reviews on their understanding of such businesses but not from personal experiences. But if a reviewer has had a firsthand experience, then you should listen. Comments of users of such investment programs are more trustworthy as they will give you their user experience as at the time they used it. This is not to say that the investment program is a good one just because it was perfect while they were at it.
4. Investing into a new business:
A new business is the one that has not crossed the first 5yr period of its existence. If you must invest in a new business, do not invest too much. Most new businesses will attract you with crazy ROI. They can tell you that they will pay you 2% of your investment everyday for a period of time. What you don’t realize is that 2% of your capital every day is the same thing as 60% of your capital every month. That’s crazy! Why should they pay you that much? What will they be doing with your money that would be that much everyday? To avoid avoidable problems, invest in businesses that have had some good histories over the years. Other things you should know are:
- What are scam detecting sites saying about the investment program? You can check the URL of the proposed investment program on SCAMADVISER and WHOIS. These sites will do a background check on the site and give you information on when the domain name was bought, how many days or years the site has been running, the average speed of the site, the site country, the valid certificates available for the site, how much does the site worth etc. and then allot a trust score to the site. A cheap site will cost the owners nothing if they run away with your money but a site whose worth is a hundred (if not million) dollars or more are not likely going to abscond
- What are the valid documents available on the site? and did they take you to the main site when you clicked them or are they just empty certificates. You also need to see the validity period of those certificates.
- Are their social media pages active? There are always social media icons available on sites. Were you taken to their social media pages when you clicked them? Or are their social media pages nonfunctional?
- Are the pages on the site properly arranged without grammatical errors or are pages on the site still having their default template content? A serious site will ensure all these are in place with properly edited articles or materials.
5. Investing What You Can’t Afford to Lose:
There are people who only have a certain amount of money and they are looking for what they can invest the money to make some more money and then become financially free. The truth is, nothing is black and white in business and there are no 100% certainty about any business transaction. Every business you will ever do will come with their risks, ability to effectively manage the risks is what will help you make some money from the deal. Now, do not invest the money you cannot afford to lose especially when you are investing in some businesses. If you cannot afford to lose money, forget about the business! Don’t use your school fees to invest in a business hoping that you will make a lot more money, it may never happen! Your school fees is not some money you can afford to lose, you should not risk it!
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