Investment checklist for the prospective investor

Over the past four weeks I have received numerous requests for advice from people who are considering putting their money into a get-rich quick scheme.
Most of the people want me to give a clean bill of health to the scheme so that they can invest in it with a peaceful conscience.
I have not responded to most of the requests for three reasons.
First, I earn money by offering financial literacy coaching and training; giving free advice to everybody who asks me is, therefore, not a good business practice.
Second, from the questions I received what many of the people need is not a tip but detailed exposure to financial literacy so that they can, in turn, make informed investment decisions.
Thirdly, the law has restrictions about provision of investment advice, especially when the investment is in securities or unlicensed public investments.
But by nature I am a fair man. So as a one off I have put down a list of investment principles for the person who still wants to get my advice free of charge.

Risk is real
Risk is uncertainty about realising the expected return. To put it another way, investors can make gains or losses.
The word “flee” means to move at a speed between running and flying.
Flee when someone tells you that an investment is a sure deal or says you cannot go wrong.
As a smart investor, identify what can hinder you from succeeding in the investment and come up with ways of addressing or mitigating the risk.

Maintain control
If you cannot maintain control of your investment, it is likely to fail.
Two things are very important for maintaining control: Having knowledge and getting timely information.
You need to know how the venture makes money, do not invest blindly. Learn how the venture can lose money as well.
You also need timely information so that you can track and steer the investment.
Many failed investments are so because of the lack of control on the part of the investor.
Ignorant and uninformed people cannot control their investment.
To illustrate investment control, before you buy a motorcycle to offer transport services in your home village, you should take time to learn how the boda boda business makes money.
You should also figure out a fool proof way for tracking the performance of the motorcycle and the money it is earning on a daily basis.

Limit your greed
An investor needs profit motivation in order take risks and put in the hard work required for the success of the investment.
But there is also a case for being too greedy and getting trapped and losing a lot of money.
Greed can be a serious factor when dealing with investments that have capital gain, for example land.
You need to set what profit is good for you so that you can sell without misgiving when the time comes.
Because of untamed greed there are people who have failed to sell off assets such as used vehicles because they kept turning away good bidders, thinking they can get a higher bid.

Know your goal
Goals provide the reasons for investing. A goal will define the amount of money you need and by what time.
You cannot achieve the goal of getting school fees for next term by investing in rental properties because the time required for the investment to mature does not match the period when you need to have the school fees ready.
Examples of areas in which people can set investment goals include financing current lifestyle, preparing for retirement and building a legacy.

Ethics matter
Investors are often faced with considerations of how the investment can affect the environment, social intercourse and the law.
A big fish politician wreaked havoc on the environment to build his lakeside hospitality business.
Several years later, God sent a lot of rain and the lake level rose to its highest in more than 40 years.
The water laid to waste the structures that had been built by the environmentally sinful politician.
Unethical investments can stock up social injustice and unrest. Here ends my free advice regarding readers’ investment queries.