INVESTMENT ACCOUNTS » Investing Money

Isn't it strange how heroes and bosses in video games never fail to do well financially? Whether the Super Mario Brothers are collecting their coins, Link from the Legend of Zelda is grabbing his rupees or Sonic the Hedgehog is saving up rings, their money seems to add up and actually be worth something.

Could it be because their money appears to be made of precious metals? Well, if that's the case, they may have something to teach to Americans who are swapping dollars that aren't worth as much as the paper it's printed on.

Seeing as though we're working as hard as video game heroes for wealth, maybe it's time to get our financial lessons from them.

The Dollar Bill's Worth

Have you ever taken time to read a dollar bill? If you've read some of the fine print, you'll find the following sentence: "This note is legal tender for all debts, public and private." Also, at the top of the bill, you'll see that your paper money is also known as a "Federal Reserve Note."

What does this mean exactly?

Well, let's talk about what it originally meant. In the early part of the 20th century, the United States was backing the paper money you hold everyday with gold. At the time, Federal Reserve Notes were redeemable, upon demand, for that amount in gold, which was being held in Fort Knox and other locations.

However, in 1969, the U.S. abandoned the gold standard monetary system completely and officially moved to what is now known as fiat currency in 1973. Fiat in Latin means "let it be done" and is the official legal tender for the U.S. dollar. Fiat currency is not backed by anything and isn't legally convertible to any other thing than itself. Also, it is not fixed in value, meaning that at any point its value could rise or fall.

Since the U.S. dollar isn't worth anything at all and isn't backed by anything, Americans are unknowingly digging themselves into debt.

That makes you wonder just what is necessary to ensure that years down the line, the money we work so hard to collect like video game heroes won't be worthless when we need it the most.

What Video Games Can Teach Us About Financial Management

As you think about accumulating real money for yourself, it's good to think like the heroes and bosses in video games. It seems their ideas about financial management result in collecting items of real value rather than holding a tight grip on currency that's worth nothing.

In other words, if you're thinking of investing, precious metals may not be a bad place to venture. Think about it, unlike the U.S. dollar, which has actually lost value over the years, gold in particular, has maintained its value. But not only that, it is recognized around the world. (Learn how to invest in gold)

And even though it's actual value doesn't change, it's value in U.S. dollars has appreciated (partially due to inflation). In 1934, gold was worth $35 per ounce. In 2006, it had increased to $625 per ounce. And in the third week of Jan. 2010, gold was up to $1,100 per ounce.

Now keep in mind that recent reports show that the dollar has gained a bit of value, which has resulted in a loss of value for gold. The reason this occurs is not because the value of the gold itself goes down (gold doesn't lose value). In actuality, interest in investing in gold has receded because people are trusting dollars more than metals.

In other words, investing in gold isn't bad. In fact, it's good, because in time, the dollar's fiat currency value is likely to drop once again, while gold, which holds real value, will hold steady.

However, before diving into this type of investment, you definitely want to conduct research on how to invest in gold and other precious metals. Learn the market inside and out to determine whether it's right for you.

While it's fun to pretend to be a video game hero, the last thing you need is collect all of your coins only to realize you weren't skilled enough to hold on to your treasures. There's nothing sadder than hearing a victory-less soundtrack play while the words "Game Over" (also known as investment losses) flash in front of your eyes.

On Wednesday, the Dow Jones industrial average (INDU) closed at an impressive 10,680.7 points, rising 0.5 percent, or 53 points. This marked the highest closed for the Dow since Oct. 1, 2008; however, the market at a whole still isn't completely stable.

Stocks Fluctuating a Bit

After a one-day selloff on Tuesday, investors on Wednesday began snatching up tech and financial shares, this despite the possibility of Google shutting down its China operations. Stocks did fall on Tuesday, but rose again on Wednesday, with the S&P 500 index (SPX) rising 9.5 points, or 0.8 percent, to close at 1,146 and Nasdaq composite (COMP) gaining 26 points, or 1.1 percent, to close at 2,308.

Making Gains Won't Be Easy This Year

Portfolio manager at Glenmede, Robert Siewert, who was interviewed by CNNMoney.com, noted that gains will be harder to come by this year. He explained after the huge selloff from investors after the financial crisis, we were lucky to have a huge recovery.

However, now that we're back at home base, many people will be more interested in simply working with their liquid funds, rather than making risky investments with no promise of gains. The only problem is that without investments, the market as a whole will make no gains.

He explained the momentum of the market is good, but still needs a push toward the fundamentals of investing, something we lost after the financial crisis. He hopes that seeing improved company profit reports will get the market back on the right track.

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