The 10 Points
- Do I have a full emergency cushion in place? If no — build it first. Investing on top of no cushion is how one bad month becomes credit card debt.
- Have I paid off any debts with interest rates above 7%? Guaranteed return of paying down a 22% credit card beats almost any market investment.
- Can I leave this money alone for at least 5 years? Shorter time horizons mean market volatility can wipe out a chunk right when you need it back.
- Do I understand what I’m buying? Not just the ticker. The actual business, fund, or asset. If I had to explain it to a friend, could I?
- Am I capturing the full employer 401(k) match first? That’s an instant 50–100% return. Nothing beats it. Do that before anything else.
- Have I filled tax-advantaged accounts before taxable? IRA, Roth IRA, HSA. These give decades of tax-free compounding most other accounts can’t match.
- Is the platform registered with the SEC or FINRA? Verified at adviserinfo.sec.gov et brokercheck.finra.org.
- Do I know all the fees? Management fee, trading fee, expense ratio, platform fee, custody fee, exit fee. Add them up annually.
- Is my allocation diversified? Not just across stocks — across asset classes, geographies, and currencies if possible.
- Would I still do this if the number dropped 40% tomorrow? Because sometimes it will. If the answer is “no, I’d panic-sell”, your allocation is too aggressive.
Want The Checklist Printable?
Email [email protected] with the subject “Checklist” and we’ll send you the one-page PDF version.