Ric Edelman: Everyone invests for different reasons, to pay for college, retire comfortably, or for some other goal. Regardless of why you're investing, achieving your investment goals is done by following just four simple steps; saving regularly, investing for the long-term, diversifying, and rebalancing. Saving make sense, the more you save, the more you'll have later. That means, you need to take a long-term approach. If you move in and out of investments on a whim, you might miss the profits that investments offer, sabotaging your efforts to grow your money, and to reduce risk, you need to diversify. That's a fancy word for simply saying that you need to invest 12 eggs in 12 baskets. That means, investing in as many asset classes and market sectors as possible, not just one or two, and finally, you need to rebalance.

You see when you own many types of investments you'll discover that at any given moment, some are doing better than others. The key is to sell some of the ones that are doing best, and buy more of the ones that are doing worst to help you maintain a diversified portfolio. It also helps to periodically sell winners, and capture those profits. It sounds counterintuitive, but if you think about it, rebalancing really just helps you buy low and sell high and everyone knows that's the key to getting rich. By following these four simple steps, you'll be better positioned to reduce your investment risks and improve your returns. Remember, it all starts with saving.