I've compiled 10 laws to help you get started and guide you towards making the right decisions about your investments...
1. Well begun is half done
Beginning well is not just about selecting investments that take off. It is about building foundations. Before you start investing, secure an income (that is, get a job) and to put a roof over your head. It is logical to pay off debt before starting to save, though there are some good reasons to borrow and save - especially in pension schemes - at the same time.
It is wise to kick things off with low-risk options. Start by putting aside some ready cash in a decent-paying bank deposit account. Then solidify the base by buying bonds and/or slices of commercial property. Only then take on shares.
2 There is safety in numbers
The best way into shares, for most people, is via an investment fund. With funds, lots of people invest together. Funds spread risk and the reduce the costs of buying and selling. They also allow you to piggy-back on the expert skills of a professional money manager.
3 Patience is a virtue
Contrary to what may be thought by those who see wheeler-dealer whizz-kids playing fast and loose with global capitalism, and who have the very short term in mind, a decade may be no more than a single unit of investment time. Good results are worth waiting for.
4 A penny saved is a penny earned
Bill Gross, the founder of PIMCO, the Pacific Investment Management Company, one of the world's largest investment companies, said: "You must work intensely to keep your investment expenses as low as possible."
The key message here is not just that you should keep expenses low - that much is obvious - but also that you have to 'work intensely' on costs. Fees and charges come in all sort of guises and it is surprisingly easy to let them mount up. It is also surprisingly easy to ignore them, or be unaware of them.
5 All that glisters is not gold
"He who wishes to be rich in a day will be hanged in a year," said Renaissance man Leonardo da Vinci. Get-rich-quick schemes are as useless as they are commonplace.
6 You must speculate to accumulate
Little can be achieved unless you are prepared to run some degree of risk. As Emperor Napoleon Bonaparte observed: "If you risk nothing, you gain nothing."
7 Don't put all your eggs in one basket
Don't just buy shares or stick your money in the bank. Don't stash it all in property or bonds, hedge funds, fine wine, ostrich farms or postage stamps. It is best to spread money about between so-called asset classes because it raises the chance of finding winners and reduces the risk of lumping on losers.
8 Ask questions
The investor who asks a question may look like a fool for five minutes. The investor who does not ask questions endures a lifetime of foolishness. It is hard to overestimate the importance of being inquisitive and of asking impertinent and/or seemingly obvious questions.
9 Diversification is a golden rule
At the heart of all sound investment practice is the management of risk. Prudent people, however, know it is necessary to embrace uncertainty, not to eliminate it, because the elimination of danger reduces, or even destroys, the opportunity to make money. Wise investors know that their judgements are fallible and insure themselves against unforeseen circumstances by keeping their fingers in lots of different pies.
Save money in bank deposits, bonds, property, shares and, perhaps, more exotic things. Own a spread of investments within each asset class and ensure that you capture the benefits of geographical diversity.
10 Never forget rule number one
Warren Buffett, a stock market guru whose fame matches his status as an investor par excellence, says that the most important rule of investment - his first rule - is not to lose money. "Rule number two," says Buffett, is, "Never forget rule number one."
Robert Cole is a senior journalist on The Times newspaper. He is the newspaper's Personal Investor columnist and author of 'The Unwritten Laws of Finance & Investment'.
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