Financial Tips | Debt Management

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by M. Angioni II

Some people can dive into a project headfirst without first having received any guidance and without having a plan. The most amazing aspect of this approach is that sometimes these people successfully complete a project. This approach may work for school papers or group projects, but do not initiate this kind of mentality on an entrepreneurial investment. Even if you are one of those people who have succeeded in the past using this “attack first, ask questions later” approach, I implore you to reconsider doing the same for your first, and in fact, any investment.

The simple solution, find a mentor. Talk to people that have already “walked the path that you are traveling.” You might be wondering how and were to talk to these people. I have an answer for you.

First, figure out exactly what kind of investment you would like to attempt. Accomplishing this will help you focus your efforts and questions to people who possess the expertise that will be most helpful to you. Once you have established your investment interest, you next must find “experts” who can give you the vital information you need to make an INFORMED decision about your investment goal.

Second, start with your immediate family and friends. Asking these people questions will not be difficult, because you will probably feel most comfortable around these people. Make sure you are asking questions of people who can help! DO NOT arbitrarily ask random friends and family members general questions, because you will not gain any useful information. Another pitfall to avoid is making a decision off of this information alone. Friends and family members may “sugar coat” the answers to tough questions so as not to discourage you. Although the intention is kind-hearted and good-spirited, this can only hurt you in the end.

If you do not have any friends or family members that can help you directly, ask if they know anybody that can help. Besides providing information, friends and family can provide many outlets for you to find information.

In the event that your friends and family and their friends and family cannot provide you with a source for useful information, this means that you will have to find an expert yourself. If this happens to you, know that you are not alone. This exact situation happened to me. About five years ago, I was extremely interested in fast food franchising. After doing research through print materials and the internet, I decided that a Subway restaurant offered the best opportunity. Because I had no family and friends that could help me gather information, I e-mailed every person on America On-Line whose profile stated that they owned a Subway franchise. You would not believe the large amount of responses I received from people who were more than willing to talk with me and answer my questions.

Third, read books, magazines, and other publications on your specific investment. Although these materials can help give you a general idea, they are no substitute for a live person, because print material may not answer all your questions. Once again, do not make a determinative decision about your investment on this information alone.

Finally, once you have compiled enough information to make an INFORMED decision, make your decision. I caution you though, do not lose contact with your mentors. They will be an invaluable resource in the future.

Having all these resources at your finger tips can help minimize your risk and maximize your returns. As Louis Pasteur once said, “chance favors the prepared mind."