I am by no means an expert, nor am I rich, but through research and observation I've put together my own investing strategy and set of rules/theories that I hope will serve my family well.
- Give. Be stingy with yourself, but generous with others. Invest in worthwhile causes that help people.
- With the current state of the economy, debt seems to be a worse idea than ever, I have no plans of going into debt (having already climbed out of that hole after our sizable college loans), and would only do so in case of an emergency.
- Create a budget and stick to it. Eliminate excess now so you have some excess later.
- Unless you're really, really loaded, cars should be a utility and not a status symbol. I don't need or want a car payment. I buy reliable used cars with cash at whatever price I can actually afford. This is even less of a concern as I can now walk to work!
- For emergencies, it seems to be a common recommendation to have 6-8 months of expenses in savings. I was surprised to read that 2/3 of Americans live paycheck to paycheck.
- Buying Individual Stocks is not investing, it's more like gambling, so we should treat it as such. The stats I've seen show that it's just not statistically feasible to play the market and come out on top. Also, how much do you trust wall street now?
- Open IRAs and try to max them out because of their tax benefits. With Vanguard it's easy to select the funds for your IRA based on your projected retirement date and the IRA will take a more aggressive approach when you're young and a more conservative one when you're closer to retirement. Roth & Traditional IRAs have different tax benefits, research which one is best for your situation.
- A diverse portfolio is not buying stocks from different industries. A diverse portfolio really means investing in different asset classes (Stocks, Bonds, Real Estate, Natural Resources, Precious Metals...).
- Compounding interest is your friend. Invest early and often and it will pay off later.
- I'd recommend Vanguard for investing in IRAs or different funds because of their reputation and low management fees. You don't have to buy an actual gold nugget -- you can buy something like ETFS Physical Swiss Gold (SGOL) from Vanguard.
- There is no silver bullet. There is no reward without risk. Bank on the numbers that have a proven track record, but realize that nothing is guaranteed and you're not entitled to high returns.
- Patience and time generally decreases the amount of risk, so hold on to your investments for the long haul.
I feel like that's a reasonable approach to investing that avoids the ever-present temptation to try 'get rich quick' schemes. As with everything, do some research. For entertaining/informative looks at investments look into the Dave Ramsey Show (free podcast -- he also has a few good books on getting out of debt), the Suze Orman Show (free podcast), and the book Money for Something (e-book).
Do your research and do what makes sense to you. If it sounds too good to be true, it probably is, and remember that the Jones's are likely broke.