| An investment club can take some time and work to | | | | fill out the tax forms, as well as perhaps joining the |
| start up, but it can be a lot of fun and very | | | | NAIC. You may also have to register as a business in |
| educational during the process. Investing in a group | | | | your community. |
| allows more money, more knowledge, and a feeling | | | | 6. Select jobs. Have individuals fill in roles that you |
| of partnership. Trust will be the main key. | | | | decided on in the plan. You might want to rotate |
| 1. Find compatible members for your club. You will | | | | jobs from meeting to meeting, so as to spread out |
| probably want between 7 – 15 members for | | | | the work, or you might have people specialize. |
| your club – too many can get very unwieldy | | | | 7. Choose a president, vice president, secretary and |
| and difficult to schedule, but too few will not allow | | | | treasurer. You may also have a person in charge of |
| enough capital to really invest. | | | | education, whom would coordinate special guests |
| 2. Determine common goals for the group. Some | | | | who speak to the qroup. |
| people may want to get into get rich quick business, | | | | 8. Open a bank or brokerage account – you |
| and investment clubs may not work well for these | | | | will need a partnership agreement or an operating |
| people. | | | | agreement in place before you do this, as the bank |
| 3. Decide how much money the club will invest on a | | | | or brokerage firm will require one to open a business |
| monthly basis. Some may want to invest a larger | | | | account. |
| amount than others can afford or are comfortable | | | | 9. Set up a budget for the club. Record initial |
| with. | | | | membership contributions, as well as determining |
| 4. Form a plan for how the club will operate. Include | | | | what monthly contributions will be. You may also |
| rules about how money will be handled, what will | | | | want to discuss having experts come in to talk with |
| happen if someone needs to withdraw their money, | | | | the group, so as to learn more about investing. |
| and how often the club will meet. | | | | Money for this may come out of monthly |
| 5. Fill out the paperwork. Form a Limited Partnership | | | | contributions, or may be added on to that month's |
| company (if that is what you choose – this | | | | expenses. Discuss this in advance to avoid |
| can be the easiest way to start your business), and | | | | misunderstanding. |