Are you one of many Albertans who will soon be receiving an income tax refund? If so, you’ll need to decide what to do with your new windfall. If you’re considering investing the money, it’s a good time for a refresher on how to Check First before you invest.
It’s always wise to take time to research any investment opportunity before making a decision. Here’s how you can get started:
Be wary of unsolicited investments.
Investment opportunities broached over the phone, by email, or through a friend, co-worker or family member may not be suitable for you. Consider that the person making the pitch may not know your financial goals or knowledge or level of risk tolerance. Review all documents carefully and don’t be afraid to get a second opinion from someone with business knowledge who is not involved with the offer.
Take time to review your investment goals.
Only 25 per cent of Albertans have a formal written financial plan with clear investment goals (CSA Investor Index 2009). Without a plan, you may be more easily swayed into an opportunity that is unsuitable for you. If you’re approached with an opportunity that sounds too good to pass up, don’t feel pressure to invest immediately. Take the time to confirm the suitability of the offer, determine the level of risk you are willing to take and decide whether the investment opportunity matches your objectives.
Conduct a background check.
Ask your salesperson if he or she is registered with the ASC. You can check registration on the ASC website or contact the ASC directly via phone (1-877-355-4488) or email (firstname.lastname@example.org) to determine if the individual or firm is registered and/or has a history of disciplinary action with the ASC.
Be aware of the latest investment scams.
Learn about common investment scams in our Investor Watch section to keep informed. Use our Scam Sensor to test your ability to spot a scam and learn more about the Red Flags of investing.
If you suspect a scam, report it.
Investment fraud can happen to anyone. A recent Canadian Securities Administrators survey indicated that just under four-in-ten Canadians (38 per cent) have been approached with a possible fraudulent investment. If you think you have been a victim of fraud or may be involved in an investment scam, visit www.albertasecurities.com to learn how to make an inquiry or file a complaint.
The best thing about these tips – they’re timeless!
So, whether you’re making your investing decisions over the next month or not until later in the year, be sure to keep these tips in mind.