One way to make solid investments is to always be thinking about investing. By this, don’t just keep your current investments on your mind but actually be aware of companies that could possibly be good investments. This is kind of a fancy way of saying “buy what you know” but with a twist.

With the “buy what you know” method, the idea is that if you do not know what to invest in, to start by thinking of some companies that you are already familiar with. Examples that come to mind are asking yourself questions like what company makes your (to get you started: car, computer, TV, cell phone, electricity, gasoline) and then buying stock in one of those companies.

The twist part comes in because by always thinking of companies in terms of how good of an investment they may or may not be, you will much more likely to do the research about the company and choose the one that will be the best choice for your situation. The thing that makes the big difference is that with the “buy what you know” method, the idea is that you have the money and you want to invest it in something. When you are always looking at companies and thinking about your next investment, you will make more informed and well thought out decisions and the idea is that you have something you want to invest in and need to find the money to do so.

Picking the companies that you see, do business with, and are familiar with is a beneficial way to pick investments because they are generally going to be stable companies that will make you money in the long-term and are usually lower risk than many of the other options available.