A house, a car, a retirement plan, heck even your TV are all investments.
As personal finance site Mom and Dad Money explains, you don t necessarily have to understand every single detail about an entire industry to be able to buy anything, but understanding how something works on a basic level should be a prerequisite to investing in it.
Before you invest in something, make sure whoever s telling you about it can explain it in a way you understand:
I don t care how good something sounds.
However, in any industry there s probably someone out there hoping to make a quick buck off of someone who isn t looking too closely at the terms of their investment.
Taking time to understand what you re investing in isn t just a good discipline, it s protection against being taken advantage of.
8 Questions You Should Ask Yourself Before Investing in Anything Mom and Dad Money via Rockstar Finance