Toward the end of 2011, I started planning my investments for 2012. Instead of investing over a long period of time, I let my money sit in my savings account because I didn’t want to pay taxes on my earnings. I was planning too much and not taking enough action.
My plan was to wait until 2012, and then invest the money in a Roth 401(k) (details about that coming in a future post) through my LLC. I was sitting on cash because I hadn’t been willing to invest it, and it was finally time to cash in.
The only problem, was that I wouldn’t exactly be liquidating my savings account, at least not for the long-term. Sure, the balance would drop, but I’m going to be replenishing it in 2012, and soon I’d be sitting on another pile of cash with no real plan.
I wanted to do all my investing in a Roth IRA, but the truth is that with $5,000 limits (and income limits that can prevent you from investing in a Roth IRA), I was going to have to join the rest of America and invest in a taxable account.
So I had to adjust my plan. There’s no day like today to start investing, so now I’m taking the plunge. And since I plan on making money from my day job and my side hustles in 2012, I’ll be using that money for the Roth 401(k). I won’t be able to make one lump deposit, but I will be smarter this year and invest every month (or quarter) so that I don’t end 2012 with cash that could have been making me money the entire year.
I believe that stocks will do really well in the long term and I want my money invested when the market skyrockets. However, that’s impossible if I sit on my cash and wait for the perfect investing conditions. Most of the time, doing something is far better than doing nothing. I finally took the leap, and I promise to be better in the future!
Readers, how dumb am I for waiting until 2012 to invest? Is it hard to part with the money in your bank and invest it?