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Learn how to invest wisely

Date posted:  8/12/15 07:45:00 AM All investments come with some sort of risk attached.

You're working too hard for your money to not let your money work for you. That's why figuring out the best ways to invest your earnings can go a long way in securing a successful, stress-free retirement. But it's important to remember that investments - no matter how safe they seem - always come with a certain level of risk. The U.S. Securities and Exchange Commission urges consumers to remember the higher the expected rate of return, the larger the risk will generally be.

A security investment, which entails all sorts of financial tools such as stocks, bonds and mutual funds, should be followed closely. The SEC said investors should keep a watchful eye for any public announcements that involve their transactions. Some announcements might seem highly intricate, but it's important to sit down and come to grips with the ins and outs of the report. In certain cases, failing to act on a public announcement can have serious implications to the health of investment, which is why it's important to understand the terms.

"Investments - no matter how safe they seem - always come with a certain level of risk."

It never hurts to have a helping hand
The amount of wealth previously amassed has little to do with future investments, according to Mindy Rosenthal, president of the Institute for Private Investors.

"Money doesn't guarantee you are a better investor than someone with less money," Rosenthal told CNNMoneywatch.

UMB Asset Management can aid your pursuit in accumulating wealth by keeping track of your active portfolios for an an agreed-upon end result. This might include endowments, foundations or trusts for Americans with a large net worth. Whatever the investment is, UMB will do its best to help you boost your financial standing.

Understand your tolerance for risk
It's crucial for investors to understand when to let money ride and when to pull the plug on a sketchy investment. Rosenthal said wealthy investors should enter the first stage of a new investment with a cash total they can afford to lose.

"Set the number you need to have at the end of the year to make you sleep at night," she said.

Once a number is determined, a wealthy investor can figure out exactly how much he or she can safely invest. If a a person has $2 million to invest but needs more than $1.6 million at the end of the year, it might be a good idea to put 80 percent of that money in a safe investment and the other 20 percent in a more high-risk, high-reward investment opportunity. Not only is this sound financial advice, but those who abide by this rule will sleep easier knowing they still have money to fall back on.

"You get more money for taking more risk, that's how it works, but you need to know what you are comfortable with losing," Rosenthal said.

"Money doesn't guarantee you are a better investor than someone with less money."

For the most part, wealthy individuals understand what they can afford to lose better than the middle class, one financial adviser told Bankrate. By understanding the risk they can handle, affluent investors tend to act less impulsively when putting money into an investment or venture, which allows them to avoid some of the knee-jerk reactions that plague other shareholders. The financial advisor said some of this has to do with trying to stay rich rather than get rich, but wealthy individuals should still try to stay ahead of the curve by pursuing the financial advice from UMB.

The financial institution also offers a personal financial review, wealth accumulation strategies, retirement planning and asset preservation and estate planning.