With the financial crisis in full swing, it has obviously had a huge direct impact on the stock market. If you’re invested in the stock market, you probably try not to look at your holdings - they’re down a ton.

Through many discussions with people we know, we’ve found that some people who are close to retirement actually are considering postponing their retirement date. Nearly 10 years of gains have been wiped out in the last 9 months. Unfortunately, they’re at a huge loss.

But we’re at a huge advantage. With stock prices so low, some say that now is the best time to buy. Analysts thought that the market would hit rock bottom in June, early July, but only one man anticipated the market falling even further. His name is Warren Buffet.

So what stocks are the best to buy?

To Learn How To Read Stock Tables (definition and terminology), click here.

Consumer Staples are a good choice. Such companies include Coca-Cola (NYSE: KO), Pepsi (NYSE: PEP), Proctor & Gamble (NYSE: PG), Sara Lee (NYSE: SLE) and Anheuser-Busch (NYSE: BUD). No matter what the economic condition is, people still need to have good hygiene, eat food and drink beer. When the market is good, people drink alcohol. When the market is bad, people drink alcohol even more.

Because these companies always have a nice profit, they are almost always able to reward shareholders with dividends. Historically, and empirically speaking, companies that pay dividends have higher earnings than companies that don’t. Sara Lee has been paying dividends since before the Great Depression.

For more information on Consumer Staples, view the bottom right hand corner of this map.

The reason we recommend these is because you can probably purchase a stock at a pretty low price, and still get a nice return from your dividends.

To read Make Money Doing Nothing: The Dividend Yield click here.

For Five Reasons To Invest In Dividend Paying Stocks, click here.

Utilities are also a good sector to invest in. These stocks are usually known as “comfort stocks”. Again, these companies are always receiving cash because people have to pay their bills. Plus, in the winter time, no matter how bad the market is, people still pay their heat and electric bills. We should warn you, many electric companies have not-so-hot asset-to-debt ratios (meaning they owe a lot more than they have). Reason being is that the money that they owe is due later than the money that is owed to them. So they accumulate a lot of “short-term” debt, which really ruins their balanace sheet, but they always have cash coming in. Take a look at Duke Energy’s (NYSE: DUK) Balance Sheet and Statement of Cash Flows.

For more information on the utility sector, see the upper right hand corner of this map.

Can stock prices go lower? Yes. Will they, who knows. That’s part of the risk you take in purchasing stocks - knowing when to buy. Generally, you buy low and sell high. Now is a pretty low time. It wouldn’t hurt to start saving and shopping around.

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College Finance 101’s investing section.

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