Risk: what could change?
Investor.gov explains that all investments involve some degree of risk. Different products expose you to different uncertainties. Rather than asking only how much an investment could earn, ask which circumstances could lead to a loss.
Cost: what do you pay?
Understand both product costs and any professional-service fees. Ask for an explanation in dollars as well as percentages, where relevant. Costs belong in the comparison alongside the product’s features.
Access: when could you need the money?
Liquidity describes how readily an investment can be bought or sold. Understand restrictions, possible costs of exiting and whether there is a market when you want to sell. Reading the product documents is part of that work.
Bring these questions.
- What are the main ways this investment could lose value?
- What would I pay to buy, hold and exit it?
- What happens if I need access earlier than planned?
Sources & further reading
Primary sources provide context for this guide. They do not endorse The Wealth Channel.
General education only. Not personalized investment, tax or legal advice. The right professional and next step depend on your circumstances.