The best time to begin investing is now—the earlier in your life, the better your wealth accumulation.
Don’t put all of your eggs in one basket. Instead, you should be distributing your money among various classes of securities using an appropriate allocation. You should diversify within each security class. Investing in 10 energy stocks is not diverse.
Investors can easily convert money market securities into cash without loss of value. They are low-risk low return instruments with liquidity, stability and provide access to money. Treasury bills rated AAA are the closest thing to risk-free securities.
Investing in bonds is desirable for more predictable income streams. It is desirable to invest in various bonds: treasury bonds, municipal bonds, and corporate bonds. These all differ in terms of credit risk, liquidity, and tax benefits.