Investment Clubs: Keeping Members Motivated

As more and more Americans plunge into debt, many financial planners have suggested investment clubs as a means of getting groups of friends or relatives interested in investing.

In the third monthly installment of her series on how to form an investment club and make it fun and profitable, ABC News personal finance expert Mellody Hobson offers tips on keeping club members motivated and on task.

What are some ways to maintain excitement and interest?

The best way to keep people interested is to assign a specific role and ongoing responsibility to every person in the club. There is no better way to generate excitement than to track the performance of your investments. However, do not be overly concerned with short-term gyrations -- to maximize returns, you should be in it for the long-term.

What are your recommended resources for new investors to educate themselves about investments and investment strategy? What books, online sources, television shows, etc. do you recommend? The Internet is an outstanding and in most cases free resource for learning more about investing. For investment clubs, BetterInvesting (www.betterinvesting.org) provides excellent educational material as well as a low-cost stock purchase plan to further ease the purchase of common stock.

For those interested in learning more about mutual funds, the Mutual Fund Education Alliance (www.mfea.org) provides some solid investing basics with an emphasis on mutual funds. As a tool to help you screen mutual funds, Morningstar is a leader in this field. Its Web site, (www.morningstar.com), provides ratings, commentary and fund details -- including portfolio manager tenure, expenses and past performance -- on thousands of mutual funds.

If you want a reference book for investment jargon, I would recommend The Wall Street Journal Guide to Understanding Money and Investing. Last, but certainly not least, start reading the business and financial pages of the newspaper (or a few newspapers, if time permits) to keep abreast of trends in the market as well as recent company news that may have an impact on your investment choices.