Just as everyone likes to fancy themselves middle class (the facts: unless you make between $2,894.83 and $4,335.75 per month, the middle quintile for the American population, you are not middle class), everyone likes to talk about how they are long-term investors.  Unfortunately, the facts don't show that to be the case.  While the average American stays in their home for seven years before selling it, many investors think displaying the same patience and horizon with a partial ownership stake in a company such as Pepsi or Johnson & Johnson is unfathomable.  To them, six months is a long-term investment!

This begs the question: How can you be sure you aren't just fooling yourself into thinking you have the right time perspective?  To help answer, I wrote a new article called How Do You Know If You Are Making a Long-Term Investment?, which includes a checklist to help you determine if you are in it for the long-haul or trading stocks and fooling yourself.

The article also explains that not every company should be a long-term investment.  Typically, you only want to own so-called "excellent businesses" that have very specific financial characteristics.  (For more information on that topic, instead, read Getting Rich By Investing in an Excellent Business).

Both should be good places to start for new investors who don't consider a good time to be chugging Pepto-Bismol in front of a trading screen, afraid to go to the bathroom for fear of losing their nest egg due to a change in the Dow Jones Industrial Average.

We need to have a talk.  Some of you?  Yeah.  I hate to break it to you but some of you will never have the emotional temperament to invest in stocks.  Many financial planners and professionals seem to refuse to accept or believe this basic fact, hoping that rational arguments will win those of you who make up this minority over to their side by using historical proof, statistical evidence, and logical, well-documented cases.  In some instances they are correct.  In the end, some of you are a lost cause.

That does not mean you have to give up on your hopes and dreams for financial independence or significant wealth!  Far from it!  It just leaves you with one less tool in the toolbox of your family's finances and that we need to look further than Wall Street to find intelligent things you can do with your savings.

Specifically, it reduces you to two big asset allocation asset classes unless you want to get into the esoteric like mineral rights, music copyrights, patents, trademarks, etc., which isn't an area most normal investors want to tread in unless they have unique insights in a field or industry due to their career.

How do you know if you are the type of investor that probably shouldn't be holding individual common stocks in your portfolio, much less try to choose new positions to add to your holdings?  This checklist might help ...

One of the most frequent themes in messages I receive from new investors, both regular readers and those who just discovered the site, is "How can I save money?".  It is understandable that this is a popular question because most schools in the United States don't teach basic life skills as mandatory courses, such as how to start a business or balance a checkbook.

To get started, I put together a collection of saving money articles that can help you make sense of the process.

• 4 Ways to Come Up With Cash
• Why Saving a Few Dollars Is Important, Even If It Doesn't Feel Like It
• How Do I Know If I Am Saving Enough Money?
• What Is The Difference Between Saving and Investing?
• 5 Tips for Making Saving Money and Investing Money Easier and Less Stressful
• How to Save the First $100,000

Though there is always more to learn, these should give you a good foundation.

I've been getting a lot of questions lately about whether or not you should pay off your mortgage early.  The bottom line: It depends.  From a purely financial perspective, having a 3.5% interest rate mortgage locked in at 15 years, getting a tax deduction, and watching your income keep pace with 4% inflation means that your real cost of borrowing is negative.  That is, you are actually getting paid to not pay off your mortgage.

On the other hand, people are not purely rational financial beings.  There are certain risks they don't want to take.  What if you lose a job?  What if you are injured and can't work?  What if your spouse passes away?  What if you have a child that is born with expensive special needs?  The emotional contentment that comes from not owing money to a bank, and knowing your home can't be taken away as long as you pay your property tax records, is valuable.

Personally?  I tell most people they are better off wiping out the debt as long as they don't strain their liquidity too much.  Most people will do something stupid if they amass a lot of cash - either make foolish investments or spend the money.  Those are far more tolerable if you own your home outright.