16 Lifelong Investment Tips - Earn 12% a Year:

1. Do not hold onto losing stocks - If you have a looser, you are not only losing the money on this downward spiral, but you are also losing the money you could have had if you had sold this investment for a loss and then invested in a good stock that actually made you money.

2. Mistake: Thinking that if a stock did well over the last 20 years it must have good performance in the future - Past history is not an indication of future performance. Sure every stock or mutual fund in the world that has averaged 20% gains a year looks great. But are you forgetting the 3,000% increase that factors into that average when the stock or mutual fund first opened at $10 a share?

3. Mistake: Not looking at the performance of a stock or mutual fund during the bad times

4. Mistake: Investing in mutual funds at all. If you like a tech mutual fund, why not just look at the top 10 holdings of that mutual fund and invest in those individual stocks yourself. Mutual funds are slow and have high fees and poor tax benefits. If you must; invest in an Exchange Traded Fund.

5. Mistake: Only investing in a few types of financial vehicles. If you are only investing in mutual funds you are stupid. If you are only investing in mutual funds and stocks you are stupid. If you are only investing in mutual funds, stocks, and bonds then you are stupid. True diversification means investing in a small business, investing in real estate, investing in money market accounts, investing internationally, etc.

6. Mistake: Picking stock based on spam emails. Believe it or not some people actually do this.

7. Mistake: Investing in a stock under $10. Did you know that the majority of stocks under $10 become de-listed from the major stock indexes and eventually go to $0.00

8. Mistake: Investing in companies you know nothing about and will not hear the terrible news about the company going completely bankrupt until it is too late.

9. Mistake: Investing in a company that consistently has negative financial news surrounding it. This is usually a recipe for disaster and investors as a whole are very sensitive to continued negative news.

10. Mistake: Trading options - Several experienced stock brokers once confided in me when I worked at a major financial brokerage house that the major way options trading is so profitable is that the investors who really know what they are doing rip off the investors who do not know what they are doing.

11. Mistake: Trading on margin - borrowing money to invest sure sounds a lot like gambling

12. Mistake: Not keeping track of capital gain losses and writing it off on your taxes. Oh did you sell that losing stock on January 1st instead of December 30th? That was dumb you could have just reduced your taxable income.

13. Mistake: Not having un-invested funds sitting in the account earning interest. Not only is this a type of diversification, but when the stock market has a crash of 6% in one day like it did a few days ago; you can actually jump in and buy some bargains.

14. Mistake: Not investing in a Roth IRA and other retirement account. Following these rules I have been averaging 13% return per year. Did you know you only need to invest about $368.84 a month at 12% return per year for 30 years to have One Million Dollars? That is just a little more for a car payment. Start when you are 30 and you will just barely make it. Are you 40 years old? Try and save a little extra and you can still make it.

15. Mistake: Spending more than you earn. Are you stupid? Did you know that those high interest credit cards are erasing your investment gains? If you spent less you could invest more and become a millionaire faster.

16. You will loose money investing. Do not put all your eggs into one basket and you will have the resources to recover from loses. Over time you will gain a greater understanding and more patience. This is not a get rich quick scheme. This is a get rich slow discipline.

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