Investments VS. Investors

A lot of people have been talking to me about investment opportunities and what may or may not be out there. Whether or not this is a good time to invest is a whole other post, but I wanted to make the clear distinction between investments and investors.

It's good to have investments. I think the only way to amass true wealth in this world is if you take some risks and invest your money. At some point you have to put your chips on the table and go all in or you'll never win. The key is knowing who and what to invest in. Just because you make an investment doesn't make you and investor.

An investor is someone who knows a certain business or program. Even having some knowledge of a particular market or area does not mean you are an investor. There are two examples that I'd like to give.

1) When the real estate market was soaring everyone and their mom thought that they could jump in and do a few loans and sell a few houses. People would jump in and do a few family members' loans or sell a house or two and they made a ton of money fast. Never learning the business, just put it through a broker or a processor who did all the work. Now all of those types have spent the money as fast as they made it. I can't find anyone who just "jumped" in, still in the business.

2) I love comic books. I read them all the time. I buy them every month and have a huge collection. I read at least one book each day if not more. It's ridiculous. I know the history of the books, characters and companies who make the comics. I'm by NO means a comic book investor. As much as I love them, I don't know anything about investing in them. I can tell you that the first appearance of Spider-man was in Amazing Fantasy but I couldn't tell you what it's worth or what condition a book is in. It takes someone who's job it is to know this stuff.

So my point is, with the drop in the market, there are a lot of people putting together plans and calling themselves investors but you have to be careful. I see all the time people wanting to buy an investment property just because it's in foreclosure. We've got some things in the works for people to invest in and this is a good market to look for good investments. Just be wary of people calling themselves investors and wanting to deal your money around, just because they went to a seminar or think that the word "foreclosure" means "bucket full of money".

I've heard and seen a lot of ideas lately, some good and some not so good. Just like anything else, if you're going to give your money to someone, make sure that you trust them and believe that they know what they're doing and what their knowledge is in what they're selling. I've known college grads who couldn't make a good investment work and I've seen high school drop outs know how to turn a bad deal good.