February 8, 2009

what am I investing for?

In the post What Am I Investing For?, Kim Kiyosaki talks about capital gains and cashflow. There are a couple of points raised.

Having a plan before investing is critical. Is this investment made to generate cashflow (income)? Is this investment going to provide satisfactory returns?

Another idea - once a dollar has been committed to investing, it isn't to be used for anything else. Specifically, cashing in investments to pay for emergencies or worse, discretionary purchases defeats the whole purpose of investing. Once that money is take out of the investment pool, you are back to square one. It is really hard to put back money once removed. It may be impossible to make up for the lost investment opportunity.
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