If you own dividend producing stocks, generally you have enough money not to worry about your next meal or two. It generally means savings and after you reached a particular amount to act like a pension, you may wish to look at other investments. As interest rates rise, as an investor that is a good thing, because if you can buy quality bonds that will have close to a 100% of being repaid (If you buy government bonds it is 100%) then you should consider moving money to the bonds and capturing the higher interest rate. Stocks tend to fluctuate in price, the main aspect with bonds is can they pay their principal back?

There are other investments, and you may be tempted by private placements. There are two concerns – the fees paid and how do you sell? Recently read about some private placements with fees of 40%, as an investor you would have to double your money just to break even. Private placements are done at a smaller scale outside of the stock market to raise money for a venture. When can you cash out? Often times they aimed at what is hot in the marketplace – if house prices are seemingly doubling, then buying land and building homes is the pitch. Just remember the land has to be zoned and usable for building homes. There are often large pieces of land seemingly available, the problem is the former use buried waste in the land and the land has to be cleaned first. It is expensive. If you are looking at investing in private placements look at the land or what the private placement would invest in before leaping. Would you live there or what to work there? By making appointments to look at the land, it gives you time to think about the investment – it most cases extra time is a very good thing to have and do. If you can hearing it is a limited short term thing – walk or run away.

Linking to dividend paying stocks, with these investments, the questions are easier. Does the company pay dividends? can it raise its dividend? why is it profitable enough to reinvest in the business and pay dividends? what is the outlook for the future? do you agree? If yes, then you can keep, it no look for alternatives.

There are more questions than answers, till the next time – to raising questions.