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One, Two, Three (Thomas Polen/Getty Images/iStockphoto)
One, Two, Three (Thomas Polen/Getty Images/iStockphoto)

Investing Basics

Four numbers novice investors need to know Add to ...

Step 1 to investing is setting your financial goals. Start by understanding your current financial situation.

Four numbers to know

1. What you own

List all your assets. This includes big items like your home, car or boat. It also includes your savings and investments. You’ll find this information in bank and investment statements, retirement savings and other pension papers, and your will.

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2. What you owe

Total up your debts. This includes any student loans, mortgages, car loans, credit cards and other debts. Look for your mortgage records, loan papers and credit card bills.

Tip: Use this worksheet to create your budget. Learn more about budgeting.

3. What you earn

Figure out your total income, including your pay, investment income and any other income. Look for this information on your tax returns, account statements and pay stubs.

4. What you spend

Track how much money you spend every month. This includes basics like food, clothing, utilities, and car costs, as well as extra expenses like eating out, going out, insurance, health or dental bills, and money you donate. Look at your bills, receipts and credit card statements. Don’t just estimate – add up bills and receipts for at least a month to get an accurate picture.

To learn more about how to get started, watch this video on do-it-yourself investing.

Content in this section is provided in partnership with Investor Education Fund, a non-profit organization founded and supported by the Ontario Securities Commission that provides unbiased and independent financial tools to help Canadians make better money decisions. To find out more, go to: GetSmarterAboutMoney.ca



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