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In many ways, you should approach investing the same way you approach shopping for a car.
So let's take a look at how you can do that.
We all know that before we dish out more than a few grand for a car, we need to figure out if we're getting a good price.
It's all about the car.
How does it perform? How often does it need repairs? What's its resale value going to be? These questions can readily be answered only if our particular model has been in production for several years.
That's fine with us, because we wouldn't want a first-year model anyway.
Besides coming with no information as to how they might perform over time, first-year models are never completely debugged.
If we wanted a good car at a good price, we also wouldn't choose the most popular model.
We'd choose a slightly out-of-favor model.
If we really wanted to save money, we'd choose a car everybody hates.
And, being the cautious buyers we are, we'd look only for a car from a manufacturer with a reputation for making quality vehicles that last.
If we play our cards right, we'll get the first two years of the car practically for free.
But we'll need to get a great price on the car to be able to sell it two years later for only slightly less than we paid.
If this is how you buy a car, you're well on your way to understanding several of the factors to consider when investing.
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