I’ve always had an interest in investments. Whether it’s in the form of stocks, a 401k, certificates of deposit, or any other investment vehicle, I firmly believe the key to preparing for your future is investing early.
With that being said, I feel there is a significant lack of education on the topic. So, I’ve made it my goal to use my platform to educate and, hopefully, shed some light on how easy it can be to begin your investing journey.
With a bit of strategy and the right mindset, you can set yourself up for a better tomorrow by starting today.
My Best Tip: Start Early
I cannot stress enough how far ahead you can put yourself by starting your investing journey early on in your life.
Is it still possible to begin investing later on in life? Of course!
However, you’ll see greater benefits when you begin as early as you can. Let’s take a look at my own experience as an example.
Fresh out of college in 1999, I decided I wanted to put money into a few stocks.
As I said, I was already interested in investments and had four picks that I felt were worth putting my money in. Those stocks were:
- HP
- Western Digital
- Seagate
- Apple
I was optimistic and ready to make some money. Unfortunately, the stock market had other ideas.
One year later, the stocks I had bought lost half of their value when the dot-com bubble burst. I wasn’t thrilled, but I also knew that markets fluctuate and I was hopeful that things would bounce back.
As the years went by, the stocks recovered and continued to rise. Eventually, I was able to sell my HP, Western Digital, and Seagate stocks to buy a ring for my now-wife. I’m thankful I took the leap and put some money in a few stocks as I was coming out of college. It’s made me a huge proponent of beginning your investing journey as soon as you can.
And in case you are wondering, yes, I’m still holding on to my Apple stock.
What’s the Easiest Way to Get Started?
If you are interested in investing, I recommend opening a Schwab trading account.
You can move over a small amount of money into your account to start and pick a few stocks just like I did in 1999. Remember, you don’t need thousands of dollars to start investing.
Do some research, talk to those around you that already have investments in place to see what stocks are doing well for them, and give it a shot.
Set Goals and Focus on Retirement Planning
With investing, you can have short and long-term goals.
Perhaps you see a stock you like that you plan to hold for 5 years and then sell for a profit. There is nothing wrong with that.
For me, though, your end goal should always be retirement and how you can mold your investment strategy to reflect that.
When you start investing early, retirement can seem like a far-off eventuality. So much so that you’re tempted to focus solely on the now. I can assure you, though, the earlier you begin thinking about your retirement planning the happier you will be.
If your employer offers a 401k match, I recommend maxing it out. Even if you have college debt or other hefty loans, I still recommend setting aside money to put toward your 401k.
Over time, these contributions will grow and you’ll be thankful you had the foresight to invest in your retirement.
Magic of Compounded Growth
By starting early and setting goals for your future, you can take advantage of compound growth. The longer you have your money in investments, the longer the time period they can accrue interest and increase their worth.
You’ve probably heard the saying “Time in the market beats timing the market.” Not only does this reflect the experience you’ll be gaining from investing, but it also refers to compound growth.
Compound growth allows your original principal and interest to grow over time. Essentially, you’re putting your money to work for you.
Be Prepared to Make Sacrifices
The last point I want to drive home is that investing does require sacrifice. You’ll need to put aside money that could be used on something you want today in order to provide more for yourself tomorrow.
Times are tough and it can be a big ask to set aside money after bills and other life expenses are taken into account. But in my opinion, any money that you can put aside for smart investments will be worth it in the long run.
Reach Out to an Experienced Professional
No matter your age, it’s never too late to start investing. Take the time to reach out to someone with experience to help guide you through investing decisions.
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