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Mistake #1 deals with confusing journalists, reporters, TV pundits and talking heads for qualified financial advisors. Be very careful whom you listen to.

On January 8th, 2008, I came home from our attorney’s office with a very large check. We had just sold our investment firm. The Everett Financial Group, Inc., had been one of the largest and most successful independent investment companies in the United States. My darling wife MarySue asked me what I was planning to do with the check—I think she felt a shopping spree coming on! My reply was, ‘put it in a guaranteed money market account’. The stock market was overpriced, and I felt led to put the proceeds in a safe place until better investment opportunities opened up.

Successful investing can be difficult, illogical, and sometimes downright precarious. If investing were easy, then everyone would be rich, and as we all know, everyone is not rich. That being said, we must embrace reality and deal with it.

Over the long haul, stocks have proven to be one of the best performing asset classes. You can make a lot of money in the great years and lose a lot of money in the lousy years, with up years nearing 40-50% and negative years at 40-50%. The long-term returns of the S&P 500 index (over the past 45 years) has been about 12%. A word of caution is in order: If you decide investing in stocks is the right choice for you and your family, make sure you have a long-term time horizon.

A dividend is a distribution (normally cash) of a portion of a company’s earnings, decided upon by the board of directors and paid to its shareholders. Dividends are usually paid out on a quarterly or annual basis. Receiving dividends is one of the ways an investor makes money. Bottom line, a dividend is your share in the apportioned profits of a company you own stock in. Attractive, don’t you think?

Risk is inevitable. All investments have some sort of risk. For instance, bonds have default and interest rate risk. Foreign stocks have currency and political risks - REITs have vacancy risks.

The only funny story I can think of regarding life insurance is from the Woody Allen movie “Take the Money and Run.” One of the scenes shows a petty thief, played by Allen, being locked up in solitary confinement with a life insurance salesman for robbing a gumball machine. Talk about cruel and unusual punishment!

The beauty of compound interest is, it allows you to earn interest on your interest — it allows your money to work for you, instead of the other way around.

Are you allowing your retirement plan dollars to roll over and play dead?

“Yes, I am a Star Trek fan. I was intrigued by the memorable scene from ‘Star Trek: Into the Darkness,’ when Leonard Nimoy’s Spock advises the younger Spock (played by Zachary Quinto) on how to defeat the treacherous villain, Kahn. It’s a time warp, science fiction moment that gets you thinking. What could I say to a younger me if I could go back in time?

If at first you don't succeed - don’t try skydiving or managing your own portfolio. It only takes one mistake for disastrous results!