Investments: 10 ways to increase the family nest egg - includes related material

Ebony, April, 1993 by Lisa C. Jones

"It makes sense to buy into these out-of-favor companies because they go up a lot more than the hot, popular ones, but a lot of people don't realize that," Rogers says.

Investors in certain age brackets should also keep a few things in mind. Dr. Sheftall says younger couples, 40 and younger, should put most of their monies into aggressive mutual funds. He suggests that middle-age couples stick with funds with moderate risks and people who are 60 and over, he says, should concentrate on conservative investments. "[At 60] your main concern is maintaining the principal. You can't run the risk of losing your principal if you're going to be retiring in the next five years.

But since older people are living way past retirement these days, Rogers says senior couples should think about growth accounts. "If you put all your money in a fixed-income account, and you're 60 and live to be 90, you're going to really wish that you had. "

Disappointment will also lie ahead for those investors who invest with hopes of receiving tax breaks down the line, Rogers says. "There really isn't much out there that can help you," he. says. "But make sure you have some money in real estate to get your mortgage deductions. "

And even homeownership doesn't pay off for everyone. "If your tax bracket is above 15 percent, then it still makes sense to buy a house rather than rent," Dr. Sheftall adds. "But the gain of homeownership for lower income people is rather marginal economically, although there are psychological benefits to owning a home."

Whatever you decide to do, don't put all of your money to work at once, the experts warn. "It's risky for families to put [all] their eggs in one basket," Dickens-King says, because any investment can have potentially large downside risks.

And the worst move families can make with their money right now, they say, is to delay a saving and investment program and to get further overburdened with consumer debt. Dickens-King adds, "If you didn't pay your Visa card payment when you were 22 and at age 25 you want to buy a house, that follows you. " So she advises couples to check their credit histories with local credit bureaus at least twice a year.

Rogers also advises Black families against investing in yesterday's success stories. "You don't want to buy yesterday's stocks or mutual funds. That's the most common mistake that people make, chasing fads, hearing from friends how some stock has doubled last year, then jumping on the bandwagon. But that's too late, " he says. "In this business you've got to be early to be successful. "

Above all, don't rush your investment program. Rogers concludes: "Take long term view and commit to how most folk build money."

10 Investment Tips

1. Sit down and figure out where your money is going. 2. Create a budget and stick to it. 3. Reduce credit and debt. 4. Pay your self first, Set aside a portion of each paycheck for savings and investments, and deduct it first. 5. Consult a certified financial planner and create a long-term strategy based on regular investments. 6. Make sure liquidity, diversity and prudent risk are a part of your financial portfolio. 7. Create an emergency fund by putting away at least six months worth of your income. 8. Buy a home instead of renting, especially if your tax bracket is above 15 percent. 9. Participate in company-based savings or investment programs if possible. 10. Sit down at least once a year and reevaluate your investment position.