1. Assume you can invest only half the amount suggested here, or about $75 a month. Use an online investment calculator to determine how much you can earn at 4 percent interest by age 65, if you start at age 25. Recalculate to see how much you would earn if you start at 35. What does the difference between the two results suggest about the value of long-term investing?
2. Why do you think experts advise buying low and selling high? Read the financial pages of a major newspaper for a few days or check the newspaper’s Web site, paying particular attention to the behavior of buyers and sellers of securities. Do you think they consistently follow this advice? Why or why not? What other ways can investors profit from buying stock shares?
3. Make a list of your financial liabilities. How much debt do you need to pay down before you can begin setting aside money for long-term investing? Do not forget to allow for other kinds of saving, such as for retirement and emergencies.